Strength Seen in Western Alliance (WAL): Can Its 7.9% Jump Turn into More Strength?

Zacks Equity Research
·2-min read

Western Alliance (WAL) shares rallied 7.9% in the last trading session to close at $100.26. 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 4% loss over the past four weeks.

Shares of Western Alliance jumped post release of first-quarter 2021 results reflecting investors’ optimism about a positive earnings surprise of 30.1%. Revenue growth and release of reserves during the quarter supported the results.

Price and Consensus

Price Consensus Chart for WAL
Price Consensus Chart for WAL

This bank holding company is expected to post quarterly earnings of $1.74 per share in its upcoming report, which represents a year-over-year change of +87.1%. Revenues are expected to be $477.67 million, up 49.4% 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 Western Alliance, the consensus EPS estimate for the quarter has been revised 5.8% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on WAL going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

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