Strength Seen in Luminex (LMNX): Can Its 12.4% Jump Turn into More Strength?

Zacks Equity Research
·2-min read

Luminex (LMNX) shares soared 12.4% in the last trading session to close at $37.03. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 1.5% gain over the past four weeks.

Luminex witnessed a solid price appreciation following the announcement that the Italian diagnostics company, DiaSorin S.p.A., is set to acquire Luminex for a price of $37 per share or approximately $1.8 billion in an all-cash transaction. On the back of DiaSorin’s extensive and geographical reach, Luminex is likely to accelerate its technology and solutions’ presence outside the United States. In fact, backed by DiaSorin’s leadership position, the company will be able to generate additional and sustainable long-term growth.

Price and Consensus

Price Consensus Chart for LMNX
Price Consensus Chart for LMNX

This manufacturer of testing systems for biotechnology companies is expected to post quarterly earnings of $0.15 per share in its upcoming report, which represents a year-over-year change of +1400%. Revenues are expected to be $110.11 million, up 21.8% 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 Luminex, 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 LMNX 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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