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EchoStar (SATS) Stock Jumps 8.8%: Will It Continue to Soar?

Zacks Equity Research
·2-min read

EchoStar (SATS) shares rallied 8.8% in the last trading session to close at $25.26. 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 8.4% gain over the past four weeks.

SATS extended its rally for the second consecutive day, driven by optimism over continued growth internationally along with robust demand in the domestic market. The consumer business has remained resilient in the United States despite COVID-19 adversities, with rising ARPUs more than offsetting the lack of capacity to add new customers. Furthermore, the launch of Jupiter 3 broadband satellite in the near future will likely provide much-needed capacity in the domestic markets, where satellite broadband demand currently outpaces supply.

Price and Consensus

Price Consensus Chart for EchoStar
Price Consensus Chart for EchoStar

This seller of set-top boxes and provider of satellite services to Dish Network is expected to post quarterly loss of $0.02 per share in its upcoming report, which represents a year-over-year change of +96.4%. Revenues are expected to be $466.9 million, up 0.3% 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 EchoStar, the consensus EPS estimate for the quarter has been revised 133.3% 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 SATS 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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