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Alto Ingredients (ALTO) Moves 7.8% Higher: Will This Strength Last?

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Alto Ingredients (ALTO - Free Report) shares rallied 7.8% in the last trading session to close at $7.18. 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 21.8% gain over the past four weeks.

Alto Ingredients has been gaining from solid specialty alcohol and essential ingredients business. The company’s recent acquisition of Eagle Alcohol expands Alto’s scope of offerings, customer base and commercial opportunities. The buyout is expected to grow adjusted EBITDA by $7-$9 million annually in 2023 and beyond, including expected synergies.

This ethanol producer is expected to post quarterly earnings of $0.09 per share in its upcoming report, which represents a year-over-year change of +28.6%. Revenues are expected to be $346.56 million, up 58.4% 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 Alto Ingredients, 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 ALTO 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 >>>>

Alto Ingredients is part of the Zacks Consumer Products - Discretionary industry. Party City (PRTY - Free Report) , another stock in the same industry, closed the last trading session 9.4% higher at $3.94. PRTY has returned 7.1% in the past month.

Party City's consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.12. Compared to the company's year-ago EPS, this represents a change of -140%. Party City currently boasts a Zacks Rank of #5 (Strong Sell).

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