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How to Find Strong Consumer Staples Stocks Slated for Positive Earnings Surprises

Zacks Equity Research
·2-min read

Earnings are arguably the most important single number on a company's quarterly financial report. Wall Street clearly dives into all of the other metrics and management's input, but the EPS figure helps cut through all the noise.

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. Anheuser-Busch Inbev (BUD) holds a Zacks Rank #3 at the moment and its Most Accurate Estimate comes in at $0.83 a share 28 days away from its upcoming earnings release on October 27, 2022.

By taking the percentage difference between the $0.83 Most Accurate Estimate and the $0.82 Zacks Consensus Estimate, Anheuser-Busch Inbev has an Earnings ESP of 1.22%.

BUD is just one of a large group of Consumer Staples stocks with a positive ESP figure. Sysco (SYY) is another qualifying stock you may want to consider.

Sysco is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on November 8, 2022. SYY's Most Accurate Estimate sits at $1 a share 40 days from its next earnings release.

Sysco's Earnings ESP figure currently stands at 0.36% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.99.

BUD and SYY'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
 
AnheuserBusch InBev SANV (BUD) : Free Stock Analysis Report
 
Sysco Corporation (SYY) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research