Investing in small-cap companies while momentum is shifting upwards could end up paying off nicely for you over the short term. When these momentous stocks start topping expectations on the earnings front, they stand to see their share prices blossom even more. However, small companies can be very volatile when it comes to meeting earnings expectations.
Thankfully, the Zacks Rank does a great job of finding stocks poised to beat the market’s EPS expectations in the very short term (1 to 3 months). When momentum is complemented by the Zacks Rank, you’ve got a winning combination. Below are three buy-ranked small-cap stocks whose shares have gained over 50% in June. As they each hold a Zacks Rank #2 (Buy) or better, they look poised to beat investor expectations when they release the results of their next quarterly earnings.
McEwen Mining Inc-(MUX - Free Report)
McEwen is engaged in mining gold and silver. In addition to owning a silver-gold mine in Argentina, they own a 49% stake in Minera Santa Cruz, a mining company based in Buenos Aires, Argentina. MUX is a Zacks Rank #2 (Buy), and its shares have gained 50.68% in value so far in June. The momentum has carried through into trading today, where the stock has picked up an impressive 4.56% as of 11:11 AM EST.
For the current year, our EPS consensus has improved over the last two months, going from an estimate of $0.03 to $0.06. One analyst has revised their EPS estimate upwards for the current year within the last 60 days. In that same time frame, no analysts have posted negative EPS revisions for this fiscal year. The company is expected to report its next quarterly earnings in the beginning of August.
North Atlantic Drilling Ltd-
North Atlantic Drilling provides harsh environment offshore drilling services to the oil and gas industry. The company primarily operates in Norway and the UK. NADL is a Zacks Rank #1 (Strong Buy), and shares have gained over 61% so far in June. North Atlantic gets a score of “A” for Momentum in our Style Scores. As oil prices trend higher, drillers like NADL stand to see higher levels of demand.
Two analysts have revised their EPS estimates for this quarter over the last 60 days. Both of those revisions were made upwards, and this has helped to boost our EPS consensus. Within the last 30 days, the consensus estimate has moved from -$0.93 to -$0.54. Our current year consensus estimate has also seen unanimously positive EPS revisions over the last 60 days. In the last month, our fiscal year consensus estimate has improved, going from -$6.24 to -$5.29. NADL is expected to release its next quarterly earnings report in late August.
Vista Gold Corporation-(VGZ - Free Report)
Vista Gold engages in mining and producing gold. The company’s principal asset is its Mt. Todd gold project in Australia. Vista Gold is a Zacks Rank #2 (Buy), and its stock has gained over 52% so far in June. Gold futures have been trending upwards, and this company stands to benefit from this trend.
Over the last two months, one analyst has revised their EPS estimate upwards for the current year. This has helped to boost our fiscal year earnings consensus estimate from $-0.12 to -$0.06. Our EPS consensus for next year has also improved, thanks in part to an EPS estimate revision from one analyst. In the last 60 days, the consensus for next year has improved significantly, going from -$0.12 to -$0.07. (VGZ - Free Report) is expected to release its next quarterly earnings report in the beginning of August.
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