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Surging Earnings Estimates Signal Upside for AssetMark Financial (AMK) Stock
Investors might want to bet on AssetMark Financial (AMK - Free Report) , as earnings estimates for this company have been showing solid improvement lately. The stock has already gained solid short-term price momentum, and this trend might continue with its still improving earnings outlook.
The rising trend in estimate revisions, which is a result of growing analyst optimism on the earnings prospects of this financial services company, should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- has this insight at its core.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
For AssetMark Financial, there has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year.
The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:
12 Month EPS
Current-Quarter Estimate Revisions
The company is expected to earn $0.55 per share for the current quarter, which represents a year-over-year change of +41.03%.
Over the last 30 days, the Zacks Consensus Estimate for AssetMark Financial has increased 11.03% because three estimates have moved higher compared to no negative revisions.
Current-Year Estimate Revisions
For the full year, the earnings estimate of $2.20 per share represents a change of +24.29% from the year-ago number.
The revisions trend for the current year also appears quite promising for AssetMark Financial, with three estimates moving higher over the past month compared to no negative revisions. The consensus estimate has also received a boost over this time frame, increasing 6.88%.
Favorable Zacks Rank
Thanks to promising estimate revisions, AssetMark Financial currently carries a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Investors have been betting on AssetMark Financial because of its solid estimate revisions, as evident from the stock's 16.2% gain over the past four weeks. As its earnings growth prospects might push the stock higher, you may consider adding it to your portfolio right away.