Strength Seen in American Public Education (APEI): Can Its 9.6% Jump Turn into More Strength?

American Public Education APEI shares rallied 9.6% in the last trading session to close at $53.15. 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 14.5% loss over the past four weeks.

The rally was likely driven by growing optimism ahead of the company's second-quarter earnings release, supported by continued momentum in its business. American Public Education has been benefiting from steady enrollment growth across its military and healthcare education programs, improving profitability, lower interest expenses following debt refinancing, and its ongoing $50 million share repurchase program.

This for-profit education company is expected to post quarterly earnings of $0.36 per share in its upcoming report, which represents a year-over-year change of +1900%. Revenues are expected to be $170.79 million, up 4.9% 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 American Public Education, 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 APEI 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 >>>>

American Public Education belongs to the Zacks Schools industry. Another stock from the same industry, Lincoln Educational Services Corporation LINC, closed the last trading session 3.2% higher at $43.15. Over the past month, LINC has returned -20.1%.

Lincoln Educational Services' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0. Compared to the company's year-ago EPS, this represents a change of -100%. Lincoln Educational Services currently boasts a Zacks Rank of #3 (Hold).

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

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