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ResMed (RMD) Stock Jumps 3.8%: Will It Continue to Soar?

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ResMed (RMD - Free Report) shares soared 3.8% in the last trading session to close at $148.65. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 12.7% loss over the past four weeks.

ResMed scored a strong price increase driven by growing device sales, reflecting the ongoing combined availability of AirSense 10 and AirSense 11 sleep devices to support strong underlying global demand. Further, in the last reported quarter, the company’s EPS surpassed the Zacks Consensus Estimate by 4.2%, raising investors’ optimism on the stock.

This maker of medical products for respiratory disorders is expected to post quarterly earnings of $1.67 per share in its upcoming report, which represents a year-over-year change of +10.6%. Revenues are expected to be $1.09 billion, up 14.9% 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 ResMed, the consensus EPS estimate for the quarter has been revised 1.2% 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 RMD 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 >>>>

ResMed is part of the Zacks Medical - Products industry. Bio-Rad Laboratories (BIO - Free Report) , another stock in the same industry, closed the last trading session 0.6% higher at $352.47. BIO has returned -11.5% in the past month.

Bio-Rad's consensus EPS estimate for the upcoming report has changed -0.5% over the past month to $2.87. Compared to the company's year-ago EPS, this represents a change of +10.4%. Bio-Rad currently boasts a Zacks Rank of #4 (Sell).


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