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Sanofi (SNY) Moves 6.0% Higher: Will This Strength Last?

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Sanofi (SNY - Free Report) shares rallied 6% in the last trading session to close at $51.73. 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 1.6% gain over the past four weeks.

Share price rose after the company announced positive data from a late-stage study evaluating its blockbuster drug Dupixent in chronic obstructive pulmonary disease (COPD) indication. Data from this study showed that treatment with Dupixent achieved a 30% reduction in moderate or severe acute COPD exacerbations, the study’s primary endpoint. Treatment with the drug also led to improved lung function, quality of life and reduction in disease symptoms. Investors cheered on this news as a potential approval in COPD indication will drive Dupixent’s sales even higher.

This drugmaker is expected to post quarterly earnings of $1.10 per share in its upcoming report, which represents a year-over-year change of +0.9%. Revenues are expected to be $11.27 billion, up 3.9% 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 Sanofi, 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 SNY 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 >>>>

Sanofi is a member of the Zacks Large Cap Pharmaceuticals industry. One other stock in the same industry, Merck (MRK - Free Report) , finished the last trading session 0.2% lower at $104.23. MRK has returned -4.4% over the past month.

Merck's consensus EPS estimate for the upcoming report has changed +3% over the past month to $1.42. Compared to the company's year-ago EPS, this represents a change of -33.6%. Merck currently boasts a Zacks Rank of #3 (Hold).

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