Strength Seen in Bilibili (BILI): Can Its 16.6% Jump Turn into More Strength?

Bilibili BILI shares soared 16.6% in the last trading session to close at $32.19. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 8.5% gain over the past four weeks.

The U.S. Investors gained confidence in Chinese tech stocks listed in U.S. exchanges like Bilibili after the Chinese government proposed changing the strict confidentiality rules to allow Bilibili to disclose financial information.

The changes in government policy came after the U.S. Securities and Exchange Commission declared that certain potential Chinese companies could be delisted for not adhering to audit requirements for publicly traded companies.

This Chinese video sharing website is expected to post quarterly loss of $0.48 per share in its upcoming report, which represents a year-over-year change of -65.5%. Revenues are expected to be $849.25 million, up 42.6% 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 Bilibili, the consensus EPS estimate for the quarter has been revised 23.8% 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 BILI 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 >>>>

Bilibili is a member of the Zacks Internet - Services industry. One other stock in the same industry, Sohu.com SOHU, finished the last trading session 4.4% higher at $18.21. SOHU has returned -3.1% over the past month.

Sohu.com's consensus EPS estimate for the upcoming report has changed +8.5% over the past month to -$0.31. Compared to the company's year-ago EPS, this represents a change of -138.8%. Sohu.com currently boasts a Zacks Rank of #2 (Buy).

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