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6 Must-Buy Stocks Set to Beat Earnings Estimates Tomorrow
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Third-quarter 2020 earnings are in full swing and market participants are watching the results closely as the last quarter was a mixed one both in terms of economic data and stock market performance.
Corporate profits in the third quarter and their guidance will be thoroughly scrutinized by financial experts and economists to gauge whether the U.S. economy will witness a V-shaped recovery this year from the coronavirus-led devastations.
Meanwhile, six companies with a favorable Zacks Rank are poised to beat earnings estimates tomorrow. This may result in an upward movement of their stock prices in the near future.
Q3 Earnings Results So Far
The third-quarter earnings season has started on a positive note though overall earnings are likely to remain negative this quarter. As of Oct 16, 49 S&P 500 companies have reported results. Total earnings of these companies are down 17.8% from the same period last year on 2.4% lower revenues, with 85.7% beating EPS estimates and 77.6% surpassing revenue estimates.
Meanwhile, for the quarter as a whole, total S&P 500 earnings are expected to decline 18.9% on 2.4% lower revenues. This would mean an improvement over an earnings decline of 22% year over year on 2.9% lower revenues, as projected before the reporting cycle.
This also implies a marked improvement over second-quarter earnings that plunged 32.3% on 9.2% lower revenues. Notably, the first-quarter earnings of companies on the S&P 500 Index were down 13.5% on 1.4% higher revenues.
Notably, overall projections for third-quarter earnings have gradually improved since July, on the reopening of a large part of the U.S. economy. Importantly, the pace of improvement has started accelerating as companies have come up with better-than-expected results. (Read More: Early Q3 Results Show Earnings Recovery in Place)
Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after earnings releases. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The chart below shows the price performance of our six picks in the third quarter.
Amphenol Corp. (APH - Free Report) primarily designs, manufactures, and markets electrical, electronic and fiber optic connectors in the United States, China and internationally. It operates in two segments, Interconnect Products and Assemblies, and Cable Products and Solutions.
The company has an Earnings ESP of +0.83% for third-quarter 2020. The Zacks Consensus Estimate of Amphenol for the current year has improved 0.3% over the last 30 days. It has a trailing four-quarter earnings surprise of 9.2%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
The Interpublic Group of Companies Inc. (IPG - Free Report) provides advertising and marketing services worldwide. It operates through two segments, Integrated Agency Networks and Constituency Management Group. The company has an Earnings ESP of +4.23% for third-quarter 2020.
The Zacks Consensus Estimate of The Interpublic Group of Companies for the current year has improved 2% over the last 30 days. It has a trailing four-quarter earnings surprise of 11.3%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Knight-Swift Transportation Holdings Inc. (KNX - Free Report) provides truckload transportation services in the United States and Mexico. It operates through three segments: Trucking, Logistics, and Intermodal. The company has an Earnings ESP of +3.65% for third-quarter 2020.
Knight-Swift Transportation Holdings has an expected earnings growth rate of 6.9% for the current year. The Zacks Consensus Estimate for the current year has improved 3.6% over the last 7 days. It has a trailing four-quarter earnings surprise of 23.2%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Avery Dennison Corp. (AVY - Free Report) produces pressure-sensitive materials, and a variety of tickets, tags, labels and other converted products. The company has an Earnings ESP of +0.57% for third-quarter 2020.
The Zacks Consensus Estimate of Avery Dennison for the current year has improved 0.5% over the last 30 days. It has a trailing four-quarter earnings surprise of 7.7%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Winnebago Industries Inc. (WGO - Free Report) manufactures and sells recreation vehicles and marine products primarily for use in leisure travel and outdoor recreation activities. It operates in five segments: Grand Design Towables, Winnebago Towables, Winnebago Motorhomes, Chris-Craft Marine, and Winnebago Specialty Vehicles. The company has an Earnings ESP of +14.44% for fourth-quarter fiscal 2020.
The Zacks Consensus Estimate of Winnebago Industries for the current year (ended August 2020) has improved 0.5% over the last 60 days. It has a trailing four-quarter earnings surprise of 9.9%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Whirlpool Corp. (WHR - Free Report) manufactures and markets home appliances and related products. It operates through four segments: North America; Europe, Middle East and Africa; Latin America; and Asia. The company has an Earnings ESP of +9.25% for third-quarter 2020.
The Zacks Consensus Estimate of Whirlpool for the current year has improved 0.5% over the last 30 days. It has a trailing four-quarter earnings surprise of 53.3%, on average. The company is set to release earnings results on Oct 21, after the closing bell.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
Image: Bigstock
6 Must-Buy Stocks Set to Beat Earnings Estimates Tomorrow
Third-quarter 2020 earnings are in full swing and market participants are watching the results closely as the last quarter was a mixed one both in terms of economic data and stock market performance.
Corporate profits in the third quarter and their guidance will be thoroughly scrutinized by financial experts and economists to gauge whether the U.S. economy will witness a V-shaped recovery this year from the coronavirus-led devastations.
Meanwhile, six companies with a favorable Zacks Rank are poised to beat earnings estimates tomorrow. This may result in an upward movement of their stock prices in the near future.
Q3 Earnings Results So Far
The third-quarter earnings season has started on a positive note though overall earnings are likely to remain negative this quarter. As of Oct 16, 49 S&P 500 companies have reported results. Total earnings of these companies are down 17.8% from the same period last year on 2.4% lower revenues, with 85.7% beating EPS estimates and 77.6% surpassing revenue estimates.
Meanwhile, for the quarter as a whole, total S&P 500 earnings are expected to decline 18.9% on 2.4% lower revenues. This would mean an improvement over an earnings decline of 22% year over year on 2.9% lower revenues, as projected before the reporting cycle.
This also implies a marked improvement over second-quarter earnings that plunged 32.3% on 9.2% lower revenues. Notably, the first-quarter earnings of companies on the S&P 500 Index were down 13.5% on 1.4% higher revenues.
Notably, overall projections for third-quarter earnings have gradually improved since July, on the reopening of a large part of the U.S. economy. Importantly, the pace of improvement has started accelerating as companies have come up with better-than-expected results. (Read More: Early Q3 Results Show Earnings Recovery in Place)
Our Top Picks
We have narrowed down our search to six stocks that are slated to release earnings results tomorrow. Each of these stocks carries a Zacks Rank # 2 (Buy) and has a positive Earnings ESP. You can see the complete list of today’s Zacks #1 Rank stocks here.
Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after earnings releases. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The chart below shows the price performance of our six picks in the third quarter.
Amphenol Corp. (APH - Free Report) primarily designs, manufactures, and markets electrical, electronic and fiber optic connectors in the United States, China and internationally. It operates in two segments, Interconnect Products and Assemblies, and Cable Products and Solutions.
The company has an Earnings ESP of +0.83% for third-quarter 2020. The Zacks Consensus Estimate of Amphenol for the current year has improved 0.3% over the last 30 days. It has a trailing four-quarter earnings surprise of 9.2%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
The Interpublic Group of Companies Inc. (IPG - Free Report) provides advertising and marketing services worldwide. It operates through two segments, Integrated Agency Networks and Constituency Management Group. The company has an Earnings ESP of +4.23% for third-quarter 2020.
The Zacks Consensus Estimate of The Interpublic Group of Companies for the current year has improved 2% over the last 30 days. It has a trailing four-quarter earnings surprise of 11.3%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Knight-Swift Transportation Holdings Inc. (KNX - Free Report) provides truckload transportation services in the United States and Mexico. It operates through three segments: Trucking, Logistics, and Intermodal. The company has an Earnings ESP of +3.65% for third-quarter 2020.
Knight-Swift Transportation Holdings has an expected earnings growth rate of 6.9% for the current year. The Zacks Consensus Estimate for the current year has improved 3.6% over the last 7 days. It has a trailing four-quarter earnings surprise of 23.2%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Avery Dennison Corp. (AVY - Free Report) produces pressure-sensitive materials, and a variety of tickets, tags, labels and other converted products. The company has an Earnings ESP of +0.57% for third-quarter 2020.
The Zacks Consensus Estimate of Avery Dennison for the current year has improved 0.5% over the last 30 days. It has a trailing four-quarter earnings surprise of 7.7%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Winnebago Industries Inc. (WGO - Free Report) manufactures and sells recreation vehicles and marine products primarily for use in leisure travel and outdoor recreation activities. It operates in five segments: Grand Design Towables, Winnebago Towables, Winnebago Motorhomes, Chris-Craft Marine, and Winnebago Specialty Vehicles. The company has an Earnings ESP of +14.44% for fourth-quarter fiscal 2020.
The Zacks Consensus Estimate of Winnebago Industries for the current year (ended August 2020) has improved 0.5% over the last 60 days. It has a trailing four-quarter earnings surprise of 9.9%, on average. The company is set to release earnings results on Oct 21, before the opening bell.
Whirlpool Corp. (WHR - Free Report) manufactures and markets home appliances and related products. It operates through four segments: North America; Europe, Middle East and Africa; Latin America; and Asia. The company has an Earnings ESP of +9.25% for third-quarter 2020.
The Zacks Consensus Estimate of Whirlpool for the current year has improved 0.5% over the last 30 days. It has a trailing four-quarter earnings surprise of 53.3%, on average. The company is set to release earnings results on Oct 21, after the closing bell.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>