Yahoo Finance How to Find Strong Consumer Discretionary Stocks Slated for Positive Earnings Surprises
Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.
We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.
2 Stocks to Add to Your Watchlist
The Zacks Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate. The core of the ESP model is comparing the Most Accurate Estimate to the Zacks Consensus Estimate, where the resulting percentage difference between the two equals the Expected Surprise Prediction.
The final step today is to look at a stock that meets our ESP qualifications. Ralph Lauren (RL) earns a Zacks Rank #3 nine days from its next quarterly earnings release on May 23, 2024, and its Most Accurate Estimate comes in at $1.66 a share.
By taking the percentage difference between the $1.66 Most Accurate Estimate and the $1.65 Zacks Consensus Estimate, Ralph Lauren has an Earnings ESP of 0.73%.
RL is just one of a large group of Consumer Discretionary stocks with a positive ESP figure. AMC Entertainment (AMC) is another qualifying stock you may want to consider.
AMC Entertainment, which is readying to report earnings on August 13, 2024, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently -$0.23 a share, and AMC is 91 days out from its next earnings report.
AMC Entertainment's Earnings ESP figure currently stands at 25.2% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of -$0.31.
Because both stocks hold a positive Earnings ESP, RL and AMC could potentially post earnings beats in their next reports.
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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Ralph Lauren Corporation (RL) : Free Stock Analysis Report
AMC Entertainment Holdings, Inc. (AMC) : Free Stock Analysis Report
