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Gibraltar Industries (ROCK) Moves 7.0% Higher: Will This Strength Last?

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Gibraltar Industries (ROCK - Free Report) shares soared 7% in the last trading session to close at $39.25. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 18.2% loss over the past four weeks.

Shares of Gibraltar surged after the company announced an agreement to sell its D.S. Brown infrastructure business to Saint-Gobain for $208 million in cash. The rally reflected investor optimism over the divestiture, which is expected to accelerate debt repayment, strengthen Gibraltar’s balance sheet and sharpen its focus on core businesses.

This building-products company is expected to post quarterly earnings of $1.24 per share in its upcoming report, which represents a year-over-year change of +8.8%. Revenues are expected to be $488.83 million, up 57.2% 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 Gibraltar Industries, 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 ROCK 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 >>>>

Gibraltar Industries is part of the Zacks Building Products - Miscellaneous industry. Frontdoor (FTDR - Free Report) , another stock in the same industry, closed the last trading session 2.4% higher at $78.26. FTDR has returned -5.1% in the past month.

For Frontdoor, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.76. This represents a change of +11.4% from what the company reported a year ago. Frontdoor currently has a Zacks Rank of #3 (Hold).

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