Pitney Bowes PBI shares soared 9.9% in the last trading session to close at $12.1. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 7.1% gain over the past four weeks.
The optimism surrounding the stock is largely due to its transformation into a cash-generative technology-enabled services with a large portion of its revenues coming from the USPS, giving its top line relative stability and resilience. High-margin SendTech shipping, disciplined cost control, strategic Receivables Purchase Program via Pitney Bowes Bank and AI adoption are also contributing to its growth.
This mailing equipment and software company is expected to post quarterly earnings of $0.27 per share in its upcoming report, which represents a year-over-year change of +800%. Revenues are expected to be $475.92 million, down 40% 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 Pitney Bowes, 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 PBI 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 >>>>
Pitney Bowes is a member of the Zacks Office Automation and Equipment industry. One other stock in the same industry, Seiko Epson Corp. SEKEY, finished the last trading session 0.3% lower at $6.3. SEKEY has returned -0.2% over the past month.
For Seiko Epson, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.13. This represents a change of -31.6% from what the company reported a year ago. Seiko Epson currently has a Zacks Rank of #3 (Hold).
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Pitney Bowes Inc. (PBI): Free Stock Analysis Report Seiko Epson Corp. (SEKEY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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