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Stellus Capital (SCM) Stock Jumps 5.2%: Will It Continue to Soar?

Zacks Equity Research
·2-min read

Stellus Capital (SCM) shares ended the last trading session 5.2% higher at $14. 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 1.3% loss over the past four weeks.

Stellus Capital witnessed a rise in share price for the second consecutive day. The company’s announcement of first quarter 2023 dividend of 40 cents per share, marks a 43% jump from the prior payout. This, along with higher interest rates, will continue to its financials. Thus, investors turned bullish on the company, driving the stock up.

This investment company is expected to post quarterly earnings of $0.38 per share in its upcoming report, which represents a year-over-year change of +15.2%. Revenues are expected to be $21.67 million, up 23.4% 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.

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For Stellus Capital, 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 SCM 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 >>>>

Stellus Capital is a member of the Zacks Financial - SBIC & Commercial Industry industry. One other stock in the same industry, BlackRock Kelso Capital (BKCC), finished the last trading session 0.5% higher at $3.79. BKCC has returned 0.8% over the past month.

For BlackRock Kelso , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.09. This represents a change of +12.5% from what the company reported a year ago. BlackRock Kelso currently has a Zacks Rank of #3 (Hold).

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Stellus Capital Investment Corporation (SCM) : Free Stock Analysis Report

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Zacks Investment Research