These 2 Consumer Discretionary Stocks Could Beat Earnings: Why They Should Be on Your Radar
Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.
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 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. With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the 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. Roku (ROKU) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at -$1.47 a share, just 29 days from its upcoming earnings release on April 27, 2023.
By taking the percentage difference between the -$1.47 Most Accurate Estimate and the -$1.48 Zacks Consensus Estimate, Roku has an Earnings ESP of 0.43%.
ROKU is one of just a large database of Consumer Discretionary stocks with positive ESPs. Another solid-looking stock is Caesars Entertainment (CZR).
Caesars Entertainment is a Zacks Rank #1 (Strong Buy) stock, and is getting ready to report earnings on May 2, 2023. CZR's Most Accurate Estimate sits at $0.21 a share 34 days from its next earnings release.
Caesars Entertainment's Earnings ESP figure currently stands at 58.49% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.13.
Because both stocks hold a positive Earnings ESP, ROKU and CZR could potentially post earnings beats in their next reports.
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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Roku, Inc. (ROKU) : Free Stock Analysis Report
Caesars Entertainment, Inc. (CZR) : Free Stock Analysis Report
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