Yahoo Finance How to Boost Your Portfolio with Top Computer and Technology Stocks Set to Beat Earnings
Two factors often determine stock prices in the long run: earnings and interest rates. Investors can't control the latter, but they can focus on a company's earnings results every quarter.
Life and the stock market are both about expectations, and rising above what is expected is often rewarded, while falling short can come with negative consequences. Investors might want to try to capture stronger returns by finding positive earnings surprises.
2 Stocks to Add to Your Watchlist
The Zacks Expected Surprise Prediction, or ESP, works by locking in on the most up-to-date analyst earnings revisions because they can be more accurate than estimates from weeks or even months before the actual release date. The thinking is pretty straightforward: analysts who provide earnings estimates closer to the report are likely to have more information. With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the ESP figure.
The last thing we will do today, now that we have a grasp on the ESP and how powerful of a tool it can be, is to look at a qualifying stock. Analog Devices (ADI) holds a Zacks Rank #3 at the moment and its Most Accurate Estimate comes in at $2.62 a share nine days away from its upcoming earnings release on February 15, 2023.
By taking the percentage difference between the $2.62 Most Accurate Estimate and the $2.59 Zacks Consensus Estimate, Analog Devices has an Earnings ESP of 1.13%.
ADI is one of just a large database of Computer and Technology stocks with positive ESPs. Another solid-looking stock is Paypal (PYPL).
Paypal, which is readying to report earnings on February 9, 2023, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently $1.21 a share, and PYPL is three days out from its next earnings report.
Paypal's Earnings ESP figure currently stands at 1.61% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $1.19.
ADI and PYPL's positive ESP metrics may signal that a positive earnings surprise for both stocks is on the horizon.
Find Stocks to Buy or Sell Before They're Reported
Use the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>
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Analog Devices, Inc. (ADI) : Free Stock Analysis Report
PayPal Holdings, Inc. (PYPL) : Free Stock Analysis Report
