LSB (LXU) shares rallied 16.7% in the last trading session to close at $11. 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 9.8% gain over the past four weeks.
LXU’s shares popped following its announcement of shareholder approval, at a special stockholder meeting, of its transaction with LSB Funding LLC to exchange the shares of LSB Series E-1 and Series F-1 redeemable preferred stock held by Eldridge for shares of LSB common stock. The transformative transaction is expected to lower cost of capital, simplify capital structure and offer greater financial flexibility to execute growth initiatives.
This chemical maker is expected to post quarterly loss of $0.26 per share in its upcoming report, which represents a year-over-year change of +75.5%. Revenues are expected to be $128.06 million, up 73.1% 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 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 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 >>>>
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