Core Viewpoint - Compass Therapeutics, Inc. (CMPX) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][4]. Earnings Estimates and Revisions - The Zacks rating system is based on the Zacks Consensus Estimate, which reflects EPS estimates from sell-side analysts for the current and following years [2]. - The recent upgrade for Compass Therapeutics reflects an improvement in the company's earnings outlook, potentially leading to increased buying pressure and stock price appreciation [4][6]. - For the fiscal year ending December 2024, Compass Therapeutics is expected to earn -$0.38 per share, representing a -15.2% change from the previous year [9]. Impact of Institutional Investors - Changes in a company's future earnings potential, as indicated by earnings estimate revisions, are strongly correlated with near-term stock price movements, largely due to institutional investors adjusting their valuations based on these estimates [5]. - Institutional investors' actions, driven by earnings estimates, can lead to significant price movements in stocks [5]. Zacks Rank System - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [8]. - The upgrade of Compass Therapeutics to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [11].
What Makes Compass Therapeutics, Inc. (CMPX) a New Buy Stock