Yahoo Finance These 2 Retail-Wholesale Stocks Could Beat Earnings: Why They Should Be on Your Radar
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.
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 Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate. 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 last thing we will do today, now that we have a grasp on the ESP and how powerful of a tool it can be, is to look at a qualifying stock. Dollar General (DG) holds a Zacks Rank #3 at the moment and its Most Accurate Estimate comes in at $1.60 a share 27 days away from its upcoming earnings release on May 30, 2024.
DG has an Earnings ESP figure of 1.88%, which, as explained above, is calculated by taking the percentage difference between the $1.60 Most Accurate Estimate and the Zacks Consensus Estimate of $1.57.
DG is one of just a large database of Retail-Wholesale stocks with positive ESPs. Another solid-looking stock is Carvana (CVNA).
Carvana, which is readying to report earnings on July 17, 2024, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently -$0.52 a share, and CVNA is 75 days out from its next earnings report.
For Carvana, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of -$0.77 is 32.51%.
Because both stocks hold a positive Earnings ESP, DG and CVNA 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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Dollar General Corporation (DG) : Free Stock Analysis Report
Carvana Co. (CVNA) : Free Stock Analysis Report
