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Olympic Steel (ZEUS) Moves 6.1% Higher: Will This Strength Last?
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Olympic Steel (ZEUS - Free Report) shares soared 6.1% in the last trading session to close at $41.44. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 24.5% gain over the past four weeks.
Olympic Steel’s shares have gained since the company announced the acquisition of Metal-Fab, Inc. – its second-largest and sixth acquisition in past five years. The buyout will expand Olympic Steel’s product offerings, manufacturing capabilities and geographic presence and is also expected to be accretive to its earnings. This is in sync with the company’s strategy to diversify and grow in high-return products and services that are expected to lower earnings volatility and increase sales and profit returns.
Metal-Fab operates from two warehousing and fabrication facilities in Wichita, KS. The business manufactures venting and filtration products for residential, commercial and industrial applications. The acquisition will provide ZEUS with a platform for accelerating growth in two target market segments - carbon coated and stainless steel.
This steel maker is expected to post quarterly earnings of $0.21 per share in its upcoming report, which represents a year-over-year change of -92.5%. Revenues are expected to be $553.95 million, down 11.3% 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 Olympic Steel, 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 ZEUS going forward to see if this recent jump can turn into more strength down the road.
Olympic Steel is a member of the Zacks Steel - Producers industry. One other stock in the same industry, Steel Dynamics (STLD - Free Report) , finished the last trading session 1% higher at $111.52. STLD has returned 8.3% over the past month.
Steel Dynamics' consensus EPS estimate for the upcoming report has changed +2.8% over the past month to $3.60. Compared to the company's year-ago EPS, this represents a change of -37.7%. Steel Dynamics currently boasts a Zacks Rank of #1 (Strong Buy).
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Olympic Steel (ZEUS) Moves 6.1% Higher: Will This Strength Last?
Olympic Steel (ZEUS - Free Report) shares soared 6.1% in the last trading session to close at $41.44. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 24.5% gain over the past four weeks.
Olympic Steel’s shares have gained since the company announced the acquisition of Metal-Fab, Inc. – its second-largest and sixth acquisition in past five years. The buyout will expand Olympic Steel’s product offerings, manufacturing capabilities and geographic presence and is also expected to be accretive to its earnings. This is in sync with the company’s strategy to diversify and grow in high-return products and services that are expected to lower earnings volatility and increase sales and profit returns.
Metal-Fab operates from two warehousing and fabrication facilities in Wichita, KS. The business manufactures venting and filtration products for residential, commercial and industrial applications. The acquisition will provide ZEUS with a platform for accelerating growth in two target market segments - carbon coated and stainless steel.
This steel maker is expected to post quarterly earnings of $0.21 per share in its upcoming report, which represents a year-over-year change of -92.5%. Revenues are expected to be $553.95 million, down 11.3% 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 Olympic Steel, 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 ZEUS going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Olympic Steel is a member of the Zacks Steel - Producers industry. One other stock in the same industry, Steel Dynamics (STLD - Free Report) , finished the last trading session 1% higher at $111.52. STLD has returned 8.3% over the past month.
Steel Dynamics' consensus EPS estimate for the upcoming report has changed +2.8% over the past month to $3.60. Compared to the company's year-ago EPS, this represents a change of -37.7%. Steel Dynamics currently boasts a Zacks Rank of #1 (Strong Buy).