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Allegheny Technologies (ATI) Moves 7.4% Higher: Will This Strength Last?

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Allegheny Technologies (ATI - Free Report) shares soared 7.4% in the last trading session to close at $23.17. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 20.3% loss over the past four weeks.

Optimism over continued growth in most significant end markets is driving the stock higher. The company is benefiting from strength in commercial jet engine and energy markets. It is well-positioned to leverage the global economic recovery, its business transformation efforts and continued recovery in commercial aerospace.

This maker of steel and specialty metals is expected to post quarterly earnings of $0.35 per share in its upcoming report, which represents a year-over-year change of +391.7%. Revenues are expected to be $831 million, up 34.9% 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 Allegheny Technologies, 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 ATI 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 >>>>

Allegheny Technologies belongs to the Zacks Steel - Speciality industry. Another stock from the same industry, Carpenter Technology (CRS - Free Report) , closed the last trading session 3.6% higher at $29.57. Over the past month, CRS has returned -18.8%.

For Carpenter, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.04. This represents a change of +114.3% from what the company reported a year ago. Carpenter currently has a Zacks Rank of #4 (Sell).


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