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Valmont (VMI) Soars 5.6%: Is Further Upside Left in the Stock?

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Valmont Industries (VMI - Free Report) shares rallied 5.6% in the last trading session to close at $299.56. 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 2.3% gain over the past four weeks.

Optimism over strong momentum across the company’s infrastructure and agriculture units appears to have driven the stock higher. VMI is gaining from strong demand in key end markets for its infrastructure business and higher average selling prices and volumes in agriculture. Its infrastructure unit is benefiting from investments by carriers to support infrastructure buildup.

This infrastructure equipment maker is expected to post quarterly earnings of $4.13 per share in its upcoming report, which represents a year-over-year change of +11.6%. Revenues are expected to be $1.15 billion, up 1.2% 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 Valmont, the consensus EPS estimate for the quarter has been revised 1.2% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on VMI 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 >>>>

Valmont is a member of the Zacks Steel - Pipe and Tube industry. One other stock in the same industry, Mueller Water Products (MWA - Free Report) , finished the last trading session 0.2% higher at $15.63. MWA has returned 12% over the past month.

Mueller Water Products' consensus EPS estimate for the upcoming report has changed -2% over the past month to $0.20. Compared to the company's year-ago EPS, this represents a change of +5.3%. Mueller Water Products currently boasts a Zacks Rank of #3 (Hold).

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