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Goosehead (GSHD) Stock Jumps 6.1%: Will It Continue to Soar?

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Goosehead Insurance (GSHD - Free Report) shares ended the last trading session 6.1% higher at $80.30. 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 16.5% loss over the past four weeks.

Goosehead continues to witness higher commissions and agency fees, franchise revenues and interest income, which are likely to boost top-line growth. Strong new business generation, new corporate and franchise agent growth and increased retention, higher corporate sales headcount and policies in force are the tailwinds for the company. The launch of digital agent platform and the reception from both agents and carrier partners will strengthen the existing go-to-market strategy, expand client referral business, and boost cross-selling opportunities.

This insurance company is expected to post quarterly earnings of $0.02 per share in its upcoming report, which represents a year-over-year change of -33.3%. Revenues are expected to be $41.81 million, up 33.9% 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 Goosehead, the consensus EPS estimate for the quarter has been revised 150% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on GSHD 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 >>>>

Goosehead belongs to the Zacks Insurance - Multi line industry. Another stock from the same industry, Trean Insurance (TIG - Free Report) , closed the last trading session 3.3% higher at $4.99. Over the past month, TIG has returned -28.9%.

For Trean Insurance, the consensus EPS estimate for the upcoming report has changed -3.1% over the past month to $0.16. This represents no change from what the company reported a year ago. Trean Insurance currently has a Zacks Rank of #4 (Sell).


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