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Guardant Health (GH) Surges 8.8%: Is This an Indication of Further Gains?

Guardant Health GH shares soared 8.8% in the last trading session to close at $30.06. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 30.9% loss over the past four weeks.

The surge in the stock price is likely due to positive momentum building around the company's approved products focused on developing liquid biopsy tests for cancer detection and monitoring. Its lead product, uardant360 test is approved to detect genetic mutations in the DNA of cancer cells.

This provider of oncology testing services is expected to post quarterly loss of $0.93 per share in its upcoming report, which represents a year-over-year change of +41.1%. Revenues are expected to be $136.83 million, up 16.6% 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 Guardant Health, the consensus EPS estimate for the quarter has been revised 1.3% 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 GH 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 >>>>

Guardant Health is a member of the Zacks Medical - Biomedical and Genetics industry. One other stock in the same industry, Illumina ILMN, finished the last trading session 0.7% lower at $132.35. ILMN has returned -19.7% over the past month.

Illumina's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.15. Compared to the company's year-ago EPS, this represents a change of -55.9%. Illumina currently boasts a Zacks Rank of #4 (Sell).

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