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Lannett (LCI) Soars 10.1%: Is Further Upside Left in the Stock?

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Lannett (LCI - Free Report) shares rallied 10.1% in the last trading session to close at $5.33. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 14.2% gain over the past four weeks.

Earlier this month, Lannett announced that the FDA has accepted Respirent Pharmaceuticals', Lannett's strategic alliance partner, abbreviated new drug application seeking approval for a generic version of Glaxo's blockbuster COPD therapy, Advair Diskus. Stock price is increasing in anticipation of a better prospect of the company following a potential approval that will boost its top-line.

This generic drug company is expected to post quarterly loss of $0.08 per share in its upcoming report, which represents a year-over-year change of -125.8%. Revenues are expected to be $112.98 million, down 18.1% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Lannett, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on LCI going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

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