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Strength Seen in Old Second Bancorp (OSBC): Can Its 5.9% Jump Turn into More Strength?

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Old Second Bancorp (OSBC - Free Report) shares ended the last trading session 5.9% higher at $14.92. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's no gain, no loss over the past four weeks.

With several macroeconomic data pointing toward cooling inflation and the “soft landing” of the U.S. economy, market participants now see relatively very low chance of a hike in interest rates this month. Also, they are of opinion that the Federal Reserve will start cutting rates by March 2024. These factors seem to have turned investors optimistic on banks, driving the Old Second Bancorp stock higher.

This financial holding company is expected to post quarterly earnings of $0.54 per share in its upcoming report, which represents a year-over-year change of +1.9%. Revenues are expected to be $72.87 million, down 0.2% 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 Old Second Bancorp, 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 OSBC going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Old Second Bancorp belongs to the Zacks Banks - Midwest industry. Another stock from the same industry, First Western (MYFW - Free Report) , closed the last trading session 2.9% higher at $17.08. Over the past month, MYFW has returned 22.4%.

First Western's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.33. Compared to the company's year-ago EPS, this represents a change of -43.1%. First Western currently boasts a Zacks Rank of #5 (Strong Sell).

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