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Surging Earnings Estimates Signal Upside for Banco Do Brasil SA (BDORY) Stock

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Banco Do Brasil SA (BDORY - Free Report) could be a solid choice for investors given the company's remarkably improving earnings outlook. While the stock has been a strong performer lately, this trend might continue since analysts are still raising their earnings estimates for the company.

The upward trend in estimate revisions for this company reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

For Banco Do Brasil SA, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.

Current-Quarter Estimate Revisions

The earnings estimate of $0.53 per share for the current quarter represents a change of +60.61% from the number reported a year ago.

Over the last 30 days, one estimate has moved higher for Banco Do Brasil SA compared to no negative revisions. As a result, the Zacks Consensus Estimate has increased 10.42%.

Current-Year Estimate Revisions

The company is expected to earn $2.03 per share for the full year, which represents a change of +59.84% from the prior-year number.

There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, one estimate has moved up for Banco Do Brasil SA versus no negative revisions. This has pushed the consensus estimate 5.18% higher.

Favorable Zacks Rank

Thanks to promising estimate revisions, Banco Do Brasil SA currently carries a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

Banco Do Brasil SA shares have added 6.8% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.


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