Strength Seen in Red Rock Resorts (RRR): Can Its 8.1% Jump Turn into More Strength?

Red Rock Resorts RRR shares rallied 8.1% in the last trading session to close at $35.36. 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 14.1% loss over the past four weeks.

Red Rock’s rally is largely driven by optimism regarding the company’s initiatives including streamlining operations, optimizing marketing initiatives and renegotiating vendor and third-party agreements. Also, attributes such as strong and consistent visitation from guests (including a younger demographic), increased spending per visit, more time spent on gaming devices and a return of core customers, bodes well for the company.

This company is expected to post quarterly earnings of $0.52 per share in its upcoming report, which represents a year-over-year change of -53.6%. Revenues are expected to be $400.36 million, down 6.5% 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 Red Rock Resorts, 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 RRR 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 >>>>

Red Rock Resorts is part of the Zacks Gaming industry. PlayAGS (AGS), another stock in the same industry, closed the last trading session 15.1% higher at $5.50. AGS has returned -15.1% in the past month.

For PlayAGS , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.04. This represents a change of +63.6% from what the company reported a year ago. PlayAGS currently has a Zacks Rank of #4 (Sell).

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