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Nomad Foods (NOMD) Moves 5.6% Higher: Will This Strength Last?

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Nomad Foods (NOMD - Free Report) shares soared 5.6% in the last trading session to close at $15.40. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 2.7% gain over the past four weeks.

Nomad Foods’ shares got a boost on the company’s preliminary third-quarter 2022 results, which were backed by efficient pricing actions and a strong underlying performance. Revenues jumped 26.7%, with organic revenues advancing 7.2%. The company’s gross margin expanded 110 basis points and the adjusted EBITDA rose 35.3%. Nomad Foods remains confident about achieving its bottom-line target for 2025. The company also unveiled the launch of its bid to refinance an existing Term Loan B of $960 million principal amount.

This frozen foods company is expected to post quarterly earnings of $0.44 per share in its upcoming report, which represents a year-over-year change of +7.3%. Revenues are expected to be $720.58 million, up 2% 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 Nomad Foods, 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 NOMD 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 >>>>

Nomad Foods is a member of the Zacks Food - Miscellaneous industry. One other stock in the same industry, Utz Brands (UTZ - Free Report) , finished the last trading session 3.3% higher at $16.21. UTZ has returned 3.9% over the past month.

Utz Brands' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.14. Compared to the company's year-ago EPS, this represents a change of -22.2%. Utz Brands currently boasts a Zacks Rank of #3 (Hold).

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