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Mesa Labs (MLAB) Moves 4.5% Higher: Will This Strength Last?

Mesa Labs (MLAB) witnessed a jump in share price last session on above-average trading volume. The latest trend in earnings estimate revisions for the...

This story originally appeared on Zacks

Mesa Labs (MLAB) shares soared 4.5% in the last trading session to close at $280. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 3.8% loss over the past four weeks.

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The stock scored a strong price increase driven by optimism surrounding the company’s strong first-quarter revenue growth, which surpassed the estimate mark by 2.4% on recovery in the healthcare services and medical device verticals, and strength in biopharmaceuticals business. Management’s optimism regarding continued economic recovery and focus on capturing opportunities in the biopharmaceutical and other healthcare driven verticals instill investors’ confidence in the stock.

Price and Consensus

Price Consensus Chart for MLAB

This quality control instruments and disposable products maker is expected to post quarterly earnings of $1.31 per share in its upcoming report, which represents a year-over-year change of -31.4%. Revenues are expected to be $34.95 million, up 9.7% 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 Mesa Labs, 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 MLAB 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 >>>>

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