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iStar (STAR) Surges 7.9%: Is This an Indication of Further Gains?

Zacks Equity Research
·2-min read

iStar Financial STAR shares rallied 7.9% in the last trading session to close at $7.27. 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 21.8% loss over the past four weeks.

The increased optimism in the stock comes after iStar provided details on the spin-off of its legacy assets business, which is a closing condition for the company’s planned merger with Safehold Inc.

This commercial real estate finance company is expected to post quarterly loss of $0.11 per share in its upcoming report, which represents a year-over-year change of -101.4%. Revenues are expected to be $29.4 million, down 8% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

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For iStar, the consensus EPS estimate for the quarter has been revised 27.3% 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 STAR 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 >>>>

iStar is a member of the Zacks REIT and Equity Trust industry. One other stock in the same industry, New York Mortgage Trust NYMT, finished the last trading session 1.6% higher at $9.08. NYMT has returned -25.5% over the past month.

For New York Mortgage Trust , the consensus EPS estimate for the upcoming report has changed -54.2% over the past month to $0.11. This represents a change of +155% from what the company reported a year ago. New York Mortgage Trust currently has a Zacks Rank of #3 (Hold).

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iStar Financial Inc. (STAR) : Free Stock Analysis Report

New York Mortgage Trust, Inc. (NYMT) : Free Stock Analysis Report

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Zacks Investment Research