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Why Investors Need to Take Advantage of These 2 Computer and Technology Stocks Now

Zacks Equity Research
·2-min read

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.

The earnings figure itself is key, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb even higher.

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.

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Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. Skyworks Solutions (SWKS) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at $1.53 a share, just 26 days from its upcoming earnings release on May 13, 2024.

SWKS has an Earnings ESP figure of 0.73%, which, as explained above, is calculated by taking the percentage difference between the $1.53 Most Accurate Estimate and the Zacks Consensus Estimate of $1.52.

SWKS is just one of a large group of Computer and Technology stocks with a positive ESP figure. Corning (GLW) is another qualifying stock you may want to consider.

Corning is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on April 30, 2024. GLW's Most Accurate Estimate sits at $0.36 a share 13 days from its next earnings release.

The Zacks Consensus Estimate for Corning is $0.36, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of 0.39%.

SWKS and GLW's positive ESP figures tell us that both stocks have a good chance at beating analyst expectations in their next earnings report.

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 >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Skyworks Solutions, Inc. (SWKS) : Free Stock Analysis Report

Corning Incorporated (GLW) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research