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Strength Seen in FAT Brands Inc. (FAT): Can Its 7.1% Jump Turn into More Strength?

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FAT Brands Inc. (FAT - Free Report) shares soared 7.1% in the last trading session to close at $7.05. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 20.7% gain over the past four weeks.

Shares of FAT Brands appreciated following the news that its Great American Cookies brand has opened its first location in the state of Alaska.

This company is expected to post quarterly loss of $1.57 per share in its upcoming report, which represents a year-over-year change of -726.3%. Revenues are expected to be $106.75 million, 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 FAT Brands Inc., 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 FAT 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 >>>>

FAT Brands Inc. belongs to the Zacks Retail - Restaurants industry. Another stock from the same industry, Darden Restaurants (DRI - Free Report) , closed the last trading session 0.5% lower at $166.86. Over the past month, DRI has returned 5.6%.

Darden Restaurants' consensus EPS estimate for the upcoming report has changed -0.4% over the past month to $2.53. Compared to the company's year-ago EPS, this represents a change of +13%. Darden Restaurants currently boasts a Zacks Rank of #3 (Hold).

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