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Ares Management (ARES) shares soared 5.7% in the last trading session to close at $124.73. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 23.8% loss over the past four weeks.
After two days of a losing streak, shares of Ares Management rallied yesterday. The momentum was driven by analysts' expectations that the Federal Reserve might be lowering interest rates to combat rising inflation numbers because of tariffs.
This private equity firm is expected to post quarterly earnings of $0.98 per share in its upcoming report, which represents a year-over-year change of +22.5%. Revenues are expected to be $964.99 million, up 31% 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 Ares Management, 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 ARES 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 >>>>
Ares Management is a member of the Zacks Financial - Investment Management industry. One other stock in the same industry, Invesco (IVZ), finished the last trading session 0.8% lower at $12.71. IVZ has returned -18% over the past month.
For Invesco , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.40. This represents a change of +21.2% from what the company reported a year ago. Invesco currently has a Zacks Rank of #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).