Strength Seen in Knot Offshore (KNOP): Can Its 8.4% Jump Turn into More Strength?

Knot Offshore (KNOP) shares soared 8.4% in the last trading session to close at $8.95. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 7.7% loss over the past four weeks.

The shipping stock has performed well this year, gaining 65% year to date. The company has been well-served by factors like high fleet utilization, operational efficiency and effective fleet expansion efforts.

This tanker company that serves the energy industry is expected to post quarterly earnings of $0.13 per share in its upcoming report, which represents a year-over-year change of +218.2%. Revenues are expected to be $86.33 million, up 13.2% 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 Knot Offshore, the consensus EPS estimate for the quarter has been revised 26.7% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on KNOP 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 >>>>

Knot Offshore is a member of the Zacks Transportation - Shipping industry. One other stock in the same industry, Kirby (KEX), finished the last trading session 0.9% higher at $82.21. KEX has returned -3.5% over the past month.

For Kirby, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.6. This represents a change of +3.2% from what the company reported a year ago. Kirby currently has a Zacks Rank of #3 (Hold).

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This article originally published on Zacks Investment Research (zacks.com).

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