Corcept (CORT) Surges 9.8%: Is This an Indication of Further Gains?

Corcept Therapeutics (CORT) shares soared 9.8% in the last trading session to close at $38.2. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 58.9% loss over the past four weeks.

Shares of Corcept plunged last week after the FDA issued a complete response letter to its new drug application seeking approval for relacorilant to treat patients with hypercortisolism (Cushing’s syndrome).

However, the stock recovered as some analysts believe that this is an ideal time to buy Corcept’s stock. This might have driven the share price rally.

This drug developer is expected to post quarterly earnings of $0.27 per share in its upcoming report, which represents a year-over-year change of +3.9%. Revenues are expected to be $254.39 million, up 39.9% 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 Corcept, 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 CORT 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 >>>>

Corcept is a member of the Zacks Medical - Drugs industry. One other stock in the same industry, Collegium Pharmaceutical (COLL), finished the last trading session 1.7% lower at $45.53. COLL has returned -2.4% over the past month.

For Collegium Pharmaceutical, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $2.21. This represents a change of +24.9% from what the company reported a year ago. Collegium Pharmaceutical currently has a Zacks Rank of #1 (Strong Buy).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

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

Zacks Investment Research