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Strength Seen in Methanex (MEOH): Can Its 5.8% Jump Turn into More Strength?

Methanex (MEOH) shares ended the last trading session 5.8% higher at $48.68. 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 9.4% gain over the past four weeks.

Optimism over favorable methanol industry conditions underpinned by healthy demand for methanol in traditional and energy applications is driving the stock higher. The Geismar 3 project will also enhance the company’s asset portfolio and future cash generation and deliver long-term value to shareholders.

This methanol supplier is expected to post quarterly earnings of $0.32 per share in its upcoming report, which represents a year-over-year change of -71.2%. Revenues are expected to be $891 million, down 14.2% 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.

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For Methanex, the consensus EPS estimate for the quarter has been revised 16.5% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on MEOH 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 >>>>

Methanex is part of the Zacks Chemical - Diversified industry. DuPont de Nemours (DD), another stock in the same industry, closed the last trading session 0.4% higher at $77.12. DD has returned 11.4% in the past month.

DuPont de Nemours' consensus EPS estimate for the upcoming report has changed +0.9% over the past month to $0.70. Compared to the company's year-ago EPS, this represents a change of -16.7%. DuPont de Nemours currently boasts a Zacks Rank of #3 (Hold).

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Methanex Corporation (MEOH) : Free Stock Analysis Report

DuPont de Nemours, Inc. (DD) : Free Stock Analysis Report

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