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Holley Inc. (HLLY) Stock Jumps 21.1%: Will It Continue to Soar?
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Holley Inc. (HLLY - Free Report) shares rallied 21.1% in the last trading session to close at $5.33. 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 16.1% gain over the past four weeks.
Shares of Holley surged yesterday following upgrades from BofA Global Research and JPMorgan. BofA upgraded the shares from Neutral to Buy, while JPMorgan raised its rating to Overweight from Neutral.
BofA's upgrade was driven by promising indicators such as web traffic data for Holley.com and resellers, suggesting potential upside in Q2 revenue. The bank also highlighted anticipated cost cuts that could result in stronger operating leverage compared to expectations, as well as improved sourcing for Holley's popular fuel injection products, which account for approximately 15% of sales.
JPMorgan, on the other hand, expressed optimism regarding Holley's topline performance in 2023 and 2024, citing conservative guidance and the forthcoming launch of Sniper 2.0. The introduction of this product is expected to contribute to organic growth and gross margin expansion, with early signs of progress anticipated in the second half of 2023. Furthermore, JPMorgan emphasized the likelihood of margin improvements driven by cost-saving measures.
Overall, these positive assessments from BofA and JPMorgan regarding better margins and potential revenue upside seem to have sparked investor enthusiasm, leading to the surge in Holley's share price.
Holley is expected to post quarterly earnings of $0.06 per share in its upcoming report, which represents a year-over-year change of -50%. Revenues are expected to be $171.4 million, down 4.5% 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 Holley 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 HLLY going forward to see if this recent jump can turn into more strength down the road.
Holley Inc. is a member of the Zacks Automotive - Original Equipment industry. One other stock in the same industry, LCI (LCII - Free Report) , finished the last trading session 2.7% higher at $128.01. LCII has returned -2.2% over the past month.
LCI's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.31. Compared to the company's year-ago EPS, this represents a change of -78.4%. LCI currently boasts a Zacks Rank of #3 (Hold).
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Holley Inc. (HLLY) Stock Jumps 21.1%: Will It Continue to Soar?
Holley Inc. (HLLY - Free Report) shares rallied 21.1% in the last trading session to close at $5.33. 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 16.1% gain over the past four weeks.
Shares of Holley surged yesterday following upgrades from BofA Global Research and JPMorgan. BofA upgraded the shares from Neutral to Buy, while JPMorgan raised its rating to Overweight from Neutral.
BofA's upgrade was driven by promising indicators such as web traffic data for Holley.com and resellers, suggesting potential upside in Q2 revenue. The bank also highlighted anticipated cost cuts that could result in stronger operating leverage compared to expectations, as well as improved sourcing for Holley's popular fuel injection products, which account for approximately 15% of sales.
JPMorgan, on the other hand, expressed optimism regarding Holley's topline performance in 2023 and 2024, citing conservative guidance and the forthcoming launch of Sniper 2.0. The introduction of this product is expected to contribute to organic growth and gross margin expansion, with early signs of progress anticipated in the second half of 2023. Furthermore, JPMorgan emphasized the likelihood of margin improvements driven by cost-saving measures.
Overall, these positive assessments from BofA and JPMorgan regarding better margins and potential revenue upside seem to have sparked investor enthusiasm, leading to the surge in Holley's share price.
Holley is expected to post quarterly earnings of $0.06 per share in its upcoming report, which represents a year-over-year change of -50%. Revenues are expected to be $171.4 million, down 4.5% 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 Holley 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 HLLY 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 >>>>
Holley Inc. is a member of the Zacks Automotive - Original Equipment industry. One other stock in the same industry, LCI (LCII - Free Report) , finished the last trading session 2.7% higher at $128.01. LCII has returned -2.2% over the past month.
LCI's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.31. Compared to the company's year-ago EPS, this represents a change of -78.4%. LCI currently boasts a Zacks Rank of #3 (Hold).