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Strength Seen in TopBuild (BLD): Can Its 5.6% Jump Turn into More Strength?

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TopBuild (BLD - Free Report) shares soared 5.6% in the last trading session to close at $465.73. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 0.7% loss over the past four weeks.

BLD stock is expected to have jumped on the back of the recent optimism surrounding housing affordability improvements in the United States. The recent meeting of the U.S. Commerce Secretary Howard Lutnick with executives from major homebuilding companies highlighted the Trump administration’s efforts to address housing affordability concerns through necessary incentive offerings. Being an installer and distributor of insulation and other building products to the U.S. construction industry, BLD’s business is closely tied to new housing starts and renovation volumes. This aspect is expected to have catalyzed the stock uptrend for TopBuild, owing to boosted investors’ sentiments.

This insulation products company is expected to post quarterly earnings of $4.36 per share in its upcoming report, which represents a year-over-year change of -15%. Revenues are expected to be $1.48 billion, up 12.9% 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 TopBuild, 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 BLD 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 >>>>

TopBuild belongs to the Zacks Building Products - Miscellaneous industry. Another stock from the same industry, Crawford & Company B (CRD.B - Free Report) , closed the last trading session 1% lower at $10.55. Over the past month, CRD.B has returned 2.7%.

For Crawford & Company B, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.23. This represents a change of +21.1% from what the company reported a year ago. Crawford & Company B currently has a Zacks Rank of #4 (Sell).


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