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GXO Logistics (GXO) Soars 5%: Is Further Upside Left in the Stock?

·2-min read

GXO Logistics (GXO) shares soared 5% in the last trading session to close at $45.69. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 18.9% loss over the past four weeks.

GXO is being well-served by the gradual resumption in economic activities. The strong e-commerce demand also bodes well for the company. In fact, GXO shares have increased more than 1% over the past week.

This contract logistics provider is expected to post quarterly earnings of $0.65 per share in its upcoming report, which represents a year-over-year change of +550%. Revenues are expected to be $2.14 billion, up 13.8% 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 GXO Logistics, the consensus EPS estimate for the quarter has been revised marginally 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 GXO 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 >>>>

GXO Logistics is part of the Zacks Transportation - Air Freight and Cargo industry. United Parcel Service (UPS), another stock in the same industry, closed the last trading session 2.6% higher at $183.30. UPS has returned 0.1% in the past month.

UPS's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $3.15. Compared to the company's year-ago EPS, this represents a change of +2.9%. UPS currently boasts a Zacks Rank of #3 (Hold).

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