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Strength Seen in World Acceptance (WRLD): Can Its 7.8% Jump Turn into More Strength?

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World Acceptance (WRLD - Free Report) shares rallied 7.8% in the last trading session to close at $135.24. 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 7.9% gain over the past four weeks.

With the Federal Reserve hitting a pause in rate hikes, finance stocks are in spotlight. Investor sentiment is gradually turning positive for the industry. Moreover, while consumer spending has been slowing, it is still stronger than what was expected if we headed straight into recession. These developments probably drove the WRLD stock higher in last day’s trading session.

This subprime consumer lender is expected to post quarterly earnings of $1.13 per share in its upcoming report, which represents a year-over-year change of -1.7%. Revenues are expected to be $139.02 million, down 11.8% 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 World Acceptance, 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 WRLD going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

World Acceptance belongs to the Zacks Financial - Consumer Loans industry. Another stock from the same industry, Credit Acceptance (CACC - Free Report) , closed the last trading session 0.3% higher at $493.31. Over the past month, CACC has returned 11.5%.

Credit Acceptance's consensus EPS estimate for the upcoming report has changed +0.3% over the past month to $10.26. Compared to the company's year-ago EPS, this represents a change of +29.2%. Credit Acceptance currently boasts a Zacks Rank of #4 (Sell).


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