Trevi Therapeutics(TRVI) ZACKS·2025-01-08 18:00Core Viewpoint - Trevi Therapeutics, Inc. (TRVI) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][4]. Earnings Estimates and Revisions - The Zacks rating system is based solely on a company's changing earnings picture, tracking the Zacks Consensus Estimate for EPS from sell-side analysts [2]. - For the fiscal year ending December 2024, Trevi Therapeutics is expected to earn -$0.49 per share, reflecting a 69% decrease from the previous year's reported number [9]. - Over the past three months, the Zacks Consensus Estimate for Trevi Therapeutics has increased by 0.7%, indicating a positive trend in earnings estimates [9]. Impact of Institutional Investors - Changes in a company's future earnings potential, as shown 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]. - An increase in earnings estimates typically leads to higher fair value for a stock, prompting institutional investors to buy or sell, which subsequently affects stock prices [5]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [8]. - The upgrade of Trevi Therapeutics to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [11].