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Strength Seen in Global Blood (GBT): Can Its 41.4% Jump Turn into More Strength?

·2-min read

Global Blood Therapeutics (GBT) shares rallied 41.4% in the last trading session to close at $47.99. 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 1.3% gain over the past four weeks.

Share  surged after Bloomberg reported that some large-cap pharmaceutical companies have shown  interest in acquiring Global Blood Therapeutics. While the article did not mention any particular suitors, it was fodder enough to attract investors' attention.

This biopharmaceutical company is expected to post quarterly loss of $1.19 per share in its upcoming report, which represents a year-over-year change of -6.3%. Revenues are expected to be $64.45 million, up 35.5% 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 Global Blood, the consensus EPS estimate for the quarter has been revised marginally 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 GBT 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 >>>>

Global Blood is part of the Zacks Medical - Biomedical and Genetics industry. Roivant Sciences Ltd. (ROIV), another stock in the same industry, closed the last trading session 0.3% higher at $3.80. ROIV has returned -21.4% in the past month.

For Roivant Sciences Ltd. , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.30. This represents a change of +18.9% from what the company reported a year ago. Roivant Sciences Ltd. currently has a Zacks Rank of #3 (Hold).

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