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Strength Seen in Luther Burbank (LBC): Can Its 6.6% Jump Turn into More Strength?

Luther Burbank (LBC) witnessed a jump in share price last session on above-average trading volume. The latest trend in earnings estimate revisions for the stock doesn't suggest further strength down...

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This story originally appeared on Zacks

Luther Burbank (LBC) shares rallied 6.6% in the last trading session to close at $13.65. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 10.1% loss over the past four weeks.

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Luther Burbank stock witnessed a rise in share price for the second consecutive day. Investors have been optimistic on the performance of banks, which is expected to be robust next year. The prospects of a tighter monetary policy – faster pace of bond-purchase tapering that will position the Federal Reserve to raise interest rates (probably thrice) in 2022 – possibly led to the bullish investor sentiments, which propel Luther Burbank higher.

This bank holding company is expected to post quarterly earnings of $0.43 per share in its upcoming report, which represents a year-over-year change of +38.7%. Revenues are expected to be $45.6 million, up 20.9% 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 Luther Burbank, 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 LBC going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>





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