Earnings Estimates Rising for Oil States International (OIS): Will It Gain?

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Investors might want to bet on Oil States International (OIS), as earnings estimates for this company have been showing solid improvement lately. The stock has already gained solid short-term price momentum, and this trend might continue with its still improving earnings outlook.

The rising trend in estimate revisions, which is a result of growing analyst optimism on the earnings prospects of this energy services company, should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

Consensus earnings estimates for the next quarter and full year have moved considerably higher for Oil States International, as there has been strong agreement among the covering analysts in raising estimates.

Current-Quarter Estimate Revisions

For the current quarter, the company is expected to earn $0.05 per share, which is a change of +266.67% from the year-ago reported number.

The Zacks Consensus Estimate for Oil States International has increased 66.67% over the last 30 days, as one estimate has gone higher compared to no negative revisions.

Current-Year Estimate Revisions

For the full year, the earnings estimate of $0.43 per share represents a change of +152.94% from the year-ago number.

The revisions trend for the current year also appears quite promising for Oil States International, with two estimates moving higher over the past month compared to no negative revisions. The consensus estimate has also received a boost over this time frame, increasing 21.43%.

Favorable Zacks Rank

Thanks to promising estimate revisions, Oil States International currently carries a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

While strong estimate revisions for Oil States International have attracted decent investments and pushed the stock 7.1% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.

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This article originally published on Zacks Investment Research (zacks.com).

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