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Strength Seen in LSB (LXU): Can Its 22.3% Jump Turn into More Strength?

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LSB Industries, Inc. (LXU - Free Report) shares ended the last trading session 22.3% higher at $9.10. 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 15.4% loss over the past four weeks.

LSB Industries’ rally is primarily driven by optimism about strength in its business attributed to a diversified portfolio of industrial and agricultural products, a potential spike in agricultural commodity prices and a strong balance sheet. Also, falling interest rates have been boosting demand for its industrial products, which is likely to drive its performance.

This chemical maker is expected to post quarterly earnings of $0.13 per share in its upcoming report, which represents a year-over-year change of +533.3%. Revenues are expected to be $109.13 million, down 17.7% 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 LSB, the consensus EPS estimate for the quarter has been revised 49% 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 LXU 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 >>>>

LSB is part of the Zacks Diversified Operations industry. Icahn Enterprises (IEP - Free Report) , another stock in the same industry, closed the last trading session 0.9% lower at $9.13. IEP has returned -8.8% in the past month.

Icahn Enterprises' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.18. Compared to the company's year-ago EPS, this represents a change of +154.6%. Icahn Enterprises currently boasts a Zacks Rank of #4 (Sell).


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