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HealthEquity (HQY) Surges 10.0%: Is This an Indication of Further Gains?

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HealthEquity (HQY - Free Report) shares ended the last trading session 10% higher at $57.70. 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 16.9% loss over the past four weeks.

HealthEquity recorded a strong price increase before its fourth-quarter fiscal 2023 earnings release with the latest Zacks Consensus Estimate showing significant upward revision for its quarterly revenues and earnings compared to the year-ago reported number. The company is scheduled to release its fiscal fourth-quarter earnings on Mar 21.

This provider of services for managing health care accounts is expected to post quarterly earnings of $0.34 per share in its upcoming report, which represents a year-over-year change of +70%. Revenues are expected to be $229.43 million, up 12.9% 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 HealthEquity, 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 HQY 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 >>>>

HealthEquity is part of the Zacks Medical Services industry. Natera (NTRA - Free Report) , another stock in the same industry, closed the last trading session 2.3% higher at $56.43. NTRA has returned 29.2% in the past month.

For Natera, the consensus EPS estimate for the upcoming report has changed +5.8% over the past month to -$1.17. This represents a change of +19.3% from what the company reported a year ago. Natera currently has a Zacks Rank of #3 (Hold).

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