Yahoo Finance How to Find Strong Business Services Stocks Slated for Positive Earnings Surprises
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.
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 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.
The final step today is to look at a stock that meets our ESP qualifications. Parsons (PSN) earns a Zacks Rank #3 seven days from its next quarterly earnings release on May 1, 2024, and its Most Accurate Estimate comes in at $0.63 a share.
PSN has an Earnings ESP figure of 1.07%, which, as explained above, is calculated by taking the percentage difference between the $0.63 Most Accurate Estimate and the Zacks Consensus Estimate of $0.62.
PSN is part of a big group of Business Services stocks that boast a positive ESP, and investors may want to take a look at Spotify (SPOT) as well.
Spotify is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on July 23, 2024. SPOT's Most Accurate Estimate sits at $0.81 a share 90 days from its next earnings release.
Spotify's Earnings ESP figure currently stands at 5.12% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.77.
Because both stocks hold a positive Earnings ESP, PSN and SPOT 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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Parsons Corporation (PSN) : Free Stock Analysis Report
Spotify Technology (SPOT) : Free Stock Analysis Report
