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Unitil (UTL) Surges 5.1%: Is This an Indication of Further Gains?

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Unitil (UTL) shares rallied 5.1% in the last trading session to close at $57.04. 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 4.8% loss over the past four weeks.

Unitil is going to benefit from continued execution of strategic plan and solid capital investment to strengthen and expand infrastructure. Strong economic development in Unitil’s service territories will create fresh demand and add thousands of new customers to its existing portfolio.

Unitil enjoys favorable regulatory environment and cold winter weather in Unitil’s service areas requires stable heat sources that maintain effectiveness and low- priced natural gas supplied by the company meet the requirement and will continue to boost performance of the company.

This utility is expected to post quarterly earnings of $0.24 per share in its upcoming report, which represents a year-over-year change of +33.3%. Revenues are expected to be $99 million, up 2.5% 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 Unitil, 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 UTL 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 >>>>

Unitil is a member of the Zacks Utility - Electric Power industry. One other stock in the same industry, NextEra Energy (NEE), finished the last trading session 1.1% higher at $78.02. NEE has returned 2.9% over the past month.

For NextEra , the consensus EPS estimate for the upcoming report has changed -0.3% over the past month to $0.75. This represents a change of +5.6% from what the company reported a year ago. NextEra currently has a Zacks Rank of #3 (Hold).


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