Thursday, May 21, 2020 7:12:07 PM
What Makes Ocugen (OCGN) a New Strong Buy Stock
Zacks Equity Research
May 21, 2020
Ocugen (OCGN) could be a solid choice for investors given its recent upgrade to a Zacks Rank #1 (Strong Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.
A company's changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate -- the consensus measure of EPS estimates from the sell-side analysts covering the stock -- for the current and following years.
The power of a changing earnings picture in determining near-term stock price movements makes the Zacks rating system highly useful for individual investors, since it can be difficult to make decisions based on rating upgrades by Wall Street analysts. These are mostly driven by subjective factors that are hard to see and measure in real time.
As such, the Zacks rating upgrade for Ocugen is essentially a positive comment on its earnings outlook that could have a favorable impact on its stock price.
Most Powerful Force Impacting Stock Prices
The change in a company's future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. That's partly because of the influence of institutional investors that use earnings and earnings estimates for calculating the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their bulk investment action then leads to price movement for the stock.
For Ocugen, rising earnings estimates and the consequent rating upgrade fundamentally mean an improvement in the company's underlying business. And investors' appreciation of this improving business trend should push the stock higher.
Harnessing the Power of Earnings Estimate Revisions
Empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, so it could be truly rewarding if such revisions are tracked for making an investment decision. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>>.
Earnings Estimate Revisions for Ocugen
This biotech knee implant developer is expected to earn -$0.15 per share for the fiscal year ending December 2020, which represents a year-over-year change of 89.9%.
Analysts have been steadily raising their estimates for Ocugen. Over the past three months, the Zacks Consensus Estimate for the company has increased 58.3%.
Bottom Line
Unlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of 'buy' and 'sell' ratings for its entire universe of more than 4000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a 'Strong Buy' rating and the next 15% get a 'Buy' rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.
You can learn more about the Zacks Rank here >>>
The upgrade of Ocugen to a Zacks Rank #1 positions it in the top 5% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.
Recent OCGN News
- UPDATE -- Ocugen to Present on Modifier Gene Therapy Platform at Association for Research in Vision and Ophthalmology 2024 Annual Meeting • GlobeNewswire Inc. • 04/26/2024 01:05:24 PM
- Ocugen to Present on Modifier Gene Therapy Platform at Association for Research in Vision and Ophthalmology 2024 Annual Meeting • GlobeNewswire Inc. • 04/26/2024 10:30:40 AM
- Ocugen Announces Dosing Completion of Subjects with Geographic Atrophy in Cohort 2 of Phase 1/2 ArMaDa Clinical Trial of OCU410—A Modifier Gene Therapy • GlobeNewswire Inc. • 04/19/2024 11:13:05 AM
- Ocugen to Participate in Fireside Chat at the Emerging Growth Virtual Healthcare Equity Conference, Presented by Noble Capital Markets • GlobeNewswire Inc. • 04/12/2024 11:30:34 AM
- Ocugen, Inc. Announces Positive Scientific Advice from the European Medicines Agency Related to the Approval Pathway for OCU400—Modifier Gene Therapy for Broad Retinitis Pigmentosa Indication • GlobeNewswire Inc. • 04/10/2024 11:02:26 AM
- Ocugen, Inc. Announces U.S. FDA Clearance of IND Amendment to Initiate OCU400 Phase 3 Clinical Trial — First Gene Therapy to Enter Phase 3 with a Broad Retinitis Pigmentosa Indication • GlobeNewswire Inc. • 04/08/2024 10:30:43 AM
- Ocugen Announces Positive Data and Safety Monitoring Board Review and Initiation of Enrollment in Medium Dose for OCU410—a Modifier Gene Therapy—in Phase 1/2 ArMaDa Study for Geographic Atrophy • GlobeNewswire Inc. • 04/05/2024 11:02:21 AM
- Ocugen Provides Business Update with Certain Financials for the Year Ending 2023 • GlobeNewswire Inc. • 04/02/2024 12:00:39 PM
- Ocugen Announces Positive Data and Safety Monitoring Board Review and Initiation of Enrollment in Medium Dose for OCU410ST—a Modifier Gene Therapy—in GARDian Study for Stargardt Disease • GlobeNewswire Inc. • 04/01/2024 10:08:46 PM
- Ocugen to Host Conference Call on Tuesday, April 2 at 8:30 A.M. ET to Provide Business Update with Certain Financials for the Year Ending 2023 • GlobeNewswire Inc. • 04/01/2024 09:43:45 PM
- Ocugen, Inc. Appoints Huma Qamar, MD, MPH as Chief Medical Officer • GlobeNewswire Inc. • 03/18/2024 10:30:50 AM
- Ocugen, Inc. Announces Dosing Completion of Subjects with Geographic Atrophy in Cohort 1 of Phase 1/2 Clinical Trial Evaluating the Safety and Efficacy of OCU410 • GlobeNewswire Inc. • 03/13/2024 12:00:54 PM
- Ocugen to Present at Investing in Cures Summit • GlobeNewswire Inc. • 03/06/2024 12:30:09 PM
- Ocugen Clinical Showcase Webcast Now Available • GlobeNewswire Inc. • 02/28/2024 01:00:26 PM
- Ocugen Chairman and CEO to present at Abu Dhabi Family Office Summit • GlobeNewswire Inc. • 02/26/2024 01:30:13 PM
- Ocugen, Inc. Announces Dosing Completion of Subjects with Stargardt in Cohort 1 of Phase 1/2 Clinical Trial Evaluating the Safety and Efficacy of OCU410ST • GlobeNewswire Inc. • 02/22/2024 09:05:00 PM
- Ocugen to Present at 2024 BIO CEO & Investor Conference • GlobeNewswire Inc. • 02/21/2024 09:05:00 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 02/21/2024 04:22:29 PM
- Ocugen to Host Clinical Showcase in New York City on Wednesday, February 21, 2024 • GlobeNewswire Inc. • 02/14/2024 12:30:49 PM
- Ocugen to Present at Pharma Market Research Conference • GlobeNewswire Inc. • 01/31/2024 01:00:12 PM
- Ocugen, Inc. Announces Bob Smith Joins Business Advisory Board • GlobeNewswire Inc. • 01/16/2024 12:30:58 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 01/08/2024 11:05:28 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/05/2024 09:47:57 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/05/2024 09:47:47 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/04/2024 10:05:00 PM
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