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Redfin (RDFN) Moves 19.7% Higher: Will This Strength Last?

Redfin (RDFN) shares rallied 19.7% in the last trading session to close at $7.28. 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 42.7% gain over the past four weeks.

The increased optimism in the stock arises from the recovery in the United States housing demand. Also, declining mortgage rates are aiding early-stage homebuyer demand.

This real estate broker is expected to post quarterly loss of $1.08 per share in its upcoming report, which represents a year-over-year change of -300%. Revenues are expected to be $444.15 million, down 30.9% 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.

For Redfin, the consensus EPS estimate for the quarter has been revised 8.9% 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 RDFN 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 >>>>

Redfin is part of the Zacks Real Estate - Operations industry. Newmark Group (NMRK), another stock in the same industry, closed the last trading session 1.8% lower at $8.56. NMRK has returned 7.4% in the past month.

Newmark Group's consensus EPS estimate for the upcoming report has changed -14% over the past month to $0.33. Compared to the company's year-ago EPS, this represents a change of -49.2%. Newmark Group currently boasts a Zacks Rank of #5 (Strong Sell).

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