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Strength Seen in Catalent (CTLT): Can Its 9.7% Jump Turn into More Strength?

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Catalent (CTLT - Free Report) shares rallied 9.7% in the last trading session to close at $59.82. 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 19.2% gain over the past four weeks.

The sharp upsurge in Catalent's shares can be attributed to the announcement of a deal where the company will be acquired by Novo Holdings for $63.50 per share in cash. The deal puts an enterprise value of $16.5 billion on Catalent.

This maker of drug delivery technologies is expected to post quarterly loss of $0.03 per share in its upcoming report, which represents a year-over-year change of -104.5%. Revenues are expected to be $1.01 billion, down 11.8% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Catalent, 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 CTLT 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 >>>>

Catalent belongs to the Zacks Medical - Drugs industry. Another stock from the same industry, Marinus Pharmaceuticals (MRNS - Free Report) , closed the last trading session 0.4% lower at $9.94. Over the past month, MRNS has returned -7.9%.

Marinus Pharmaceuticals' consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.64. Compared to the company's year-ago EPS, this represents a change of +15.8%. Marinus Pharmaceuticals currently boasts a Zacks Rank of #3 (Hold).

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