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Strength Seen in Septerna, Inc. (SEPN): Can Its 7.0% Jump Turn into More Strength?

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Septerna, Inc. (SEPN - Free Report) shares soared 7% in the last trading session to close at $22.49. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 38% gain over the past four weeks.

The sudden surge in the stock price likely reflects the growing investor optimism regarding the potential of Septerna’s only clinical-pipeline candidate, SEP-631, which is being developed in an early-stage study for treating chronic spontaneous urticaria and other mast cell diseases. Earlier this year, the company signed a global collaboration and licensing deal worth up to $2.2 billion with Novo Nordisk to develop oral small-molecule therapies for obesity and cardiometabolic diseases. The partnership combines Septerna’s GPCR drug discovery expertise with NVO’s leadership and innovation in the field of obesity and cardiometabolic diseases.

This company is expected to post quarterly earnings of $0.19 per share in its upcoming report, which represents a year-over-year change of +102.3%. Revenues are expected to be $75 million, up 41566.7% 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 Septerna, 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 SEPN 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 >>>>

Septerna, Inc. is a member of the Zacks Medical - Biomedical and Genetics industry. One other stock in the same industry, Gyre Therapeutics, Inc. (GYRE - Free Report) , finished the last trading session 0.4% higher at $7.3. GYRE has returned -5.2% over the past month.

For Gyre Therapeutics, Inc., the consensus EPS estimate for the upcoming report has changed -59.3% over the past month to $0.05. This represents a change of +150% from what the company reported a year ago. Gyre Therapeutics, Inc. currently has a Zacks Rank of #4 (Sell).


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