Methode (MEI) Stock Jumps 21.2%: Will It Continue to Soar?

Methode MEI shares rallied 21.2% in the last trading session to close at $14.02. 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 6.6% gain over the past four weeks.

Methode benefits from strong demand for off-road lighting and power distribution solutions supporting data centers, growing exposure to higher-growth industrial power markets, data center infrastructure investments and vehicle electrification opportunities.

This maker of electrical components for the auto and computer industries is expected to post quarterly loss of $0.11 per share in its upcoming report, which represents a year-over-year change of +85.7%. Revenues are expected to be $228.82 million, down 11% 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 Methode, 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 MEI 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 >>>>

Methode belongs to the Zacks Electronics - Connectors industry. Another stock from the same industry, Amphenol APH, closed the last trading session 1.8% higher at $163.96. Over the past month, APH has returned 30.9%.

For Amphenol, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.15. This represents a change of +42% from what the company reported a year ago. Amphenol currently has a Zacks Rank of #2 (Buy).

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

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