Yahoo Finance How to Boost Your Portfolio with Top Computer and Technology Stocks Set to Beat Earnings
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.
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.
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. Autodesk (ADSK) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at $1.58 a share, just 20 days from its upcoming earnings release on May 25, 2023.
Autodesk's Earnings ESP sits at 1.76%, which, as explained above, is calculated by taking the percentage difference between the $1.58 Most Accurate Estimate and the Zacks Consensus Estimate of $1.55.
ADSK is part of a big group of Computer and Technology stocks that boast a positive ESP, and investors may want to take a look at Cisco Systems (CSCO) as well.
Cisco Systems is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on May 17, 2023. CSCO's Most Accurate Estimate sits at $0.99 a share 12 days from its next earnings release.
Cisco Systems' Earnings ESP figure currently stands at 1.59% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.97.
ADSK and CSCO'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 >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Autodesk, Inc. (ADSK) : Free Stock Analysis Report
Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report
