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Strength Seen in Griffon (GFF): Can Its 7.4% Jump Turn into More Strength?

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Griffon (GFF - Free Report) shares soared 7.4% in the last trading session to close at $38.75. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 3.4% gain over the past four weeks.

The stock jumped primarily on optimism surrounding the easing of supply chain disruptions and an expectation of margin improvement as interest rate hikes slow down.

This garage door and building products maker is expected to post quarterly earnings of $1.03 per share in its upcoming report, which represents a year-over-year change of +164.1%. Revenues are expected to be $708 million, up 19.7% 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 Griffon, 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 GFF 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 >>>>

Griffon is a member of the Zacks Diversified Operations industry. One other stock in the same industry, ITT (ITT - Free Report) , finished the last trading session 0.4% lower at $84.91. ITT has returned 5.8% over the past month.

For ITT, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.25. This represents a change of +17.9% from what the company reported a year ago. ITT currently has a Zacks Rank of #3 (Hold).


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