Forge Global (FRGE) Surges 41.5%: Is This an Indication of Further Gains?

Forge Global Holdings, Inc. (FRGE) shares ended the last trading session 41.5% higher at $12.30. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 6.3% loss over the past four weeks.

Forge witnessed a significant price rise following its announcement of signing a non-binding term sheet to acquire Accuidity Capital Management, a private investment-focused asset manager, for $10 million in cash and 1.15 million Forge common shares, with potential earn-outs of up to 1 million additional shares based on performance milestones through 2027. The deal aims to enhance Forge’s asset management capabilities. It is likely to be accretive to EPS if completed and will support the company’s goal of achieving breakeven adjusted EBITDA in 2026.

Besides, Forge’s boasts an integrated, technology-driven platform designed specifically for private markets. With more than a decade of operating experience and more than $15 billion in transaction volume across 600+ companies, Forge has developed proprietary infrastructure that efficiently supports trading, custody, data and asset management. Strategic investments in complementary services—like Forge Trust for custody and Forge Pro for institutional trading—bolster client retention and scalability. 

This company is expected to post quarterly loss of $1.26 per share in its upcoming report, which represents a year-over-year change of +16%. Revenues are expected to be $25.04 million, up 30.2% 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 Forge Global, the consensus EPS estimate for the quarter has been revised 4.6% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on FRGE 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 >>>>

Forge Global belongs to the Zacks Financial - Miscellaneous Services industry. Another stock from the same industry, Rithm (RITM), closed the last trading session 1.7% lower at $9.97. Over the past month, RITM has returned -12.8%.

Rithm's consensus EPS estimate for the upcoming report has changed +3.2% over the past month to $0.47. Compared to the company's year-ago EPS, this represents a change of -2.1%. Rithm currently boasts a Zacks Rank of #2 (Buy).

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

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