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Looking for Stocks with Positive Earnings Momentum? Check Out These 2 Computer and Technology Names

Zacks Equity Research
·2-min read

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.

Life and the stock market are both about expectations, and rising above what is expected is often rewarded, while falling short can come with negative consequences. Investors might want to try to capture stronger returns by finding positive earnings surprises.

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.

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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. Oracle (ORCL) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at $1.08 a share, just 28 days from its upcoming earnings release on September 12, 2022.

Oracle's Earnings ESP sits at 1.41%, which, as explained above, is calculated by taking the percentage difference between the $1.08 Most Accurate Estimate and the Zacks Consensus Estimate of $1.07.

ORCL is one of just a large database of Computer and Technology stocks with positive ESPs. Another solid-looking stock is F5 Networks (FFIV).

F5 Networks, which is readying to report earnings on October 25, 2022, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently $2.54 a share, and FFIV is 71 days out from its next earnings report.

The Zacks Consensus Estimate for F5 Networks is $2.52, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of 0.99%.

ORCL and FFIV'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 >>


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
 
Oracle Corporation (ORCL) : Free Stock Analysis Report
 
F5, Inc. (FFIV) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research