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Tactile Systems Technology (TCMD) Moves 6.2% Higher: Will This Strength Last?

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Tactile Systems Technology (TCMD - Free Report) shares ended the last trading session 6.2% higher at $36.21. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 22.5% loss over the past four weeks.

Tactile Systems Technology recorded a strong price increase driven by a 45% year-over-year revenue growth in the last-reported second quarter of 2021 benefiting from the early stages of recovery from the COVID-19 pandemic. From the second half of the quarter, both clinic throughput and in-clinic patient access improved as a bigger percentage of the population obtained vaccinations and government restrictions were eased. The recovery trends by site of care revealed that outpatient based privately owned practices, particularly vascular clinics, had the fastest recovery rates. Further, enhanced productivity of the company’s sales force and the expansion of its prescriber base were other revenue contributors.

This medical device maker is expected to post quarterly earnings of $0.13 per share in its upcoming report, which represents a year-over-year change of +8.3%. Revenues are expected to be $57.03 million, up 16.2% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Tactile Systems Technology, 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 TCMD 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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