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Looking for Stocks with Positive Earnings Momentum? Check Out These 2 Consumer Staples Names
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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.
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.
Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.
The Zacks Earnings ESP, Explained
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.
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 Zacks Rank is also factored into the ESP metric to better help find companies that appear poised to top their next bottom-line consensus estimate, which will hopefully help lift the stock price.
In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.
Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.
Should You Consider Beyond Meat?
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. Beyond Meat (BYND - Free Report) earns a #2 (Buy) right now and its Most Accurate Estimate sits at -$0.69 a share, just 22 days from its upcoming earnings release on August 3, 2023.
BYND has an Earnings ESP figure of +14.6%, which, as explained above, is calculated by taking the percentage difference between the -$0.69 Most Accurate Estimate and the Zacks Consensus Estimate of -$0.81. Beyond Meat is one of a large database of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
BYND is one of just a large database of Consumer Staples stocks with positive ESPs. Another solid-looking stock is e.l.f. Beauty (ELF - Free Report) .
e.l.f. Beauty, which is readying to report earnings on August 1, 2023, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently $0.61 a share, and ELF is 20 days out from its next earnings report.
e.l.f. Beauty's Earnings ESP figure currently stands at +4.8% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.58.
BYND and ELF'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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Looking for Stocks with Positive Earnings Momentum? Check Out These 2 Consumer Staples Names
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.
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.
Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.
The Zacks Earnings ESP, Explained
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.
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 Zacks Rank is also factored into the ESP metric to better help find companies that appear poised to top their next bottom-line consensus estimate, which will hopefully help lift the stock price.
In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.
Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.
Should You Consider Beyond Meat?
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. Beyond Meat (BYND - Free Report) earns a #2 (Buy) right now and its Most Accurate Estimate sits at -$0.69 a share, just 22 days from its upcoming earnings release on August 3, 2023.
BYND has an Earnings ESP figure of +14.6%, which, as explained above, is calculated by taking the percentage difference between the -$0.69 Most Accurate Estimate and the Zacks Consensus Estimate of -$0.81. Beyond Meat is one of a large database of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
BYND is one of just a large database of Consumer Staples stocks with positive ESPs. Another solid-looking stock is e.l.f. Beauty (ELF - Free Report) .
e.l.f. Beauty, which is readying to report earnings on August 1, 2023, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently $0.61 a share, and ELF is 20 days out from its next earnings report.
e.l.f. Beauty's Earnings ESP figure currently stands at +4.8% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.58.
BYND and ELF'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 >>