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Strength Seen in ProPetro (PUMP): Can Its 11.3% Jump Turn into More Strength?

Zacks Equity Research
·2-min read

ProPetro Holding (PUMP) shares soared 11.3% in the last trading session to close at $8. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 27.3% loss over the past four weeks.

ProPetro Holding continued its surge for the second straight day, driven by optimism over crude prices spurred by the surprise production cut from OPEC. The rally in commodity prices to around $80 a barrel is set to push drilling activity higher and contributed to the strength in the company, which is an oilfield services provider operating primarily in the Permian Basin.

This oilfield services company is expected to post quarterly earnings of $0.34 per share in its upcoming report, which represents a year-over-year change of +209.1%. Revenues are expected to be $410.08 million, up 45.1% 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.

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For ProPetro, the consensus EPS estimate for the quarter has been revised 2.1% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on PUMP 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 >>>>

ProPetro is a member of the Zacks Oil and Gas - Field Services industry. One other stock in the same industry, NexTier Oilfield Solutions (NEX), finished the last trading session 9.8% higher at $8.73. NEX has returned -21% over the past month.

NexTier Oilfield Solutions' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.45. Compared to the company's year-ago EPS, this represents a change of +462.5%. NexTier Oilfield Solutions currently boasts a Zacks Rank of #3 (Hold).

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ProPetro Holding Corp. (PUMP) : Free Stock Analysis Report

NexTier Oilfield Solutions Inc. (NEX) : Free Stock Analysis Report

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Zacks Investment Research