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OFS Capital (OFS) Soars 5.2%: Is Further Upside Left in the Stock?

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OFS Capital (OFS - Free Report) shares rallied 5.2% in the last trading session to close at $10.70. 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 7.3% gain over the past four weeks.

Shares of OFS Capital rallied for the third consecutive day. With the Federal Reserve hitting a pause in rate hikes, finance stocks are in spotlight. Investor sentiment is gradually turning positive for the sector. Hence, this optimistic stance drove the OFS stock higher.

This management investment company is expected to post quarterly earnings of $0.35 per share in its upcoming report, which represents a year-over-year change of -25.5%. Revenues are expected to be $14.2 million, up 36.2% 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 OFS Capital, 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 OFS 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 >>>>

OFS Capital belongs to the Zacks Financial - SBIC & Commercial Industry industry. Another stock from the same industry, Gladstone Investment (GAIN - Free Report) , closed the last trading session 0.8% lower at $12.98. Over the past month, GAIN has returned 0.2%.

For Gladstone Investment, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.26. This represents a change of +18.2% from what the company reported a year ago. Gladstone Investment currently has a Zacks Rank of #3 (Hold).

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