Strength Seen in Profound Medical (PROF): Can Its 8.3% Jump Turn into More Strength?

Profound Medical (PROF) shares rallied 8.3% in the last trading session to close at $5.23. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 10.1% loss over the past four weeks.

The sudden surge in share price can be attributed to positive investor expectations from Profound’s lead marketed product, the Tulsa-Pro system, which is approved for the ablation of prostate tissue.

This company is expected to post quarterly loss of $0.29 per share in its upcoming report, which represents a year-over-year change of -11.5%. Revenues are expected to be $3.45 million, up 80.6% 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 Profound Medical, 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 PROF 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 >>>>

Profound Medical belongs to the Zacks Medical - Drugs industry. Another stock from the same industry, Journey Medical Corporation (DERM), closed the last trading session 2.2% higher at $7.03. Over the past month, DERM has returned 4.4%.

For Journey Medical

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

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