Earnings are arguably the most important single number on a company’s quarterly financial report. Wall Street clearly dives into all of the other metrics and management’s input, but the EPS figure helps cut through all the noise.
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 is more formally known as the Expected Surprise Prediction, and it aims to grab the inside track on the latest analyst estimate revisions ahead of a company’s report. The idea is relatively intuitive as a newer projection might be based on more complete information. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.
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. Western Midstream (WES) earns a Zacks Rank #2 right now and its Most Accurate Estimate sits at $1.07 a share, just 15 days from its upcoming earnings release on August 7, 2024.
By taking the percentage difference between the $1.07 Most Accurate Estimate and the $0.89 Zacks Consensus Estimate, Western Midstream has an Earnings ESP of 19.66%.
WES is just one of a large group of Oils-Energy stocks with a positive ESP figure. Suncor Energy (SU) is another qualifying stock you may want to consider.
Suncor Energy, which is readying to report earnings on August 12, 2024, sits at a Zacks Rank #3 (Hold) right now. It’s Most Accurate Estimate is currently $0.80 a share, and SU is 20 days out from its next earnings report.
For Suncor Energy, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.76 is 5.73%.
WES and SU’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 >>
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Western Midstream Partners, LP (WES) : Free Stock Analysis Report
Suncor Energy Inc. (SU) : Free Stock Analysis Report
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