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Red River Bancshares (RRBI) Moves 5.9% Higher: Will This Strength Last?

Red River Bancshares (RRBI) witnessed a jump in share price last session on above-average trading volume. The latest trend in earnings estimate revisi...

This story originally appeared on Zacks

Red River Bancshares (RRBI) shares ended the last trading session 5.9% higher at $50.49. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 6.6% loss over the past four weeks.

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Optimistic investor sentiments surrounding the solid performance of the banking sector drove Red River Bancshares stock. This can be attributed to strong economic growth expectations, gradual rise in loan demand, sooner-than-expected interest rate hike and favorable economic data.

This holding company for Red River Bank is expected to post quarterly earnings of $0.98 per share in its upcoming report, which represents a year-over-year change of -1%. Revenues are expected to be $23.43 million, down 1.2% 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 Red River Bancshares, 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 RRBI 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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