USA Compression Partners (USAC) shares soared 8.5% in the last trading session to close at $27.76. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 8.6% gain over the past four weeks.
The surge can be attributed to strong natural gas demand driven by shale plays, which leads to increased demand for USAC’s compression services. Its strategic focus on maintaining large horsepower and securing a diversified, creditworthy customer base results in consistent returns on invested capital. The company's volume-based contracts and low operating costs contribute to steady cash flow, making it an attractive dividend stock. USAC's strong financial performance in the past has likely boosted investor confidence, leading to a rise in its stock price.
This natural gas compression services company is expected to post quarterly earnings of $0.26 per share in its upcoming report, which represents a year-over-year change of +160%. Revenues are expected to be $241.6 million, up 7.4% 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 USA Compression, the consensus EPS estimate for the quarter has been revised 1.5% 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 USAC going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
USA Compression is part of the Zacks Oil and Gas - Mechanical and and Equipment industry. Nov Inc. (NOV), another stock in the same industry, closed the last trading session 0.5% higher at $14.47. NOV has returned -1.4% in the past month.
For Nov Inc.
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NOV Inc. (NOV) : Free Stock Analysis Report
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