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How to Find Strong Computer and Technology 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 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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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. Corning (GLW) holds a Zacks Rank #3 at the moment and its Most Accurate Estimate comes in at $0.41 a share 29 days away from its upcoming earnings release on April 25, 2023.

GLW has an Earnings ESP figure of 5.91%, which, as explained above, is calculated by taking the percentage difference between the $0.41 Most Accurate Estimate and the Zacks Consensus Estimate of $0.39.

GLW is just one of a large group of Computer and Technology stocks with a positive ESP figure. Workday (WDAY) is another qualifying stock you may want to consider.

Workday is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on May 25, 2023. WDAY's Most Accurate Estimate sits at $1.15 a share 59 days from its next earnings release.

The Zacks Consensus Estimate for Workday is $1.05, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of 9.04%.

GLW and WDAY'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

Corning Incorporated (GLW) : Free Stock Analysis Report

Workday, Inc. (WDAY) : Free Stock Analysis Report

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Zacks Investment Research