Yahoo Finance Want Better Returns? Don't Ignore These 2 Utilities Stocks Set to Beat Earnings
Wall Street watches a company's quarterly report closely to understand as much as possible about its recent performance and what to expect going forward. Of course, one figure often stands out among the rest: earnings.
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.
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. American Electric Power (AEP) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at $1.34 a share, just 28 days from its upcoming earnings release on April 27, 2023.
By taking the percentage difference between the $1.34 Most Accurate Estimate and the $1.29 Zacks Consensus Estimate, American Electric Power has an Earnings ESP of 4.29%.
AEP is part of a big group of Utilities stocks that boast a positive ESP, and investors may want to take a look at Consolidated Edison (ED) as well.
Consolidated Edison, which is readying to report earnings on May 4, 2023, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently $1.71 a share, and ED is 35 days out from its next earnings report.
Consolidated Edison's Earnings ESP figure currently stands at 0.83% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $1.70.
Because both stocks hold a positive Earnings ESP, AEP and ED 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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American Electric Power Company, Inc. (AEP) : Free Stock Analysis Report
Consolidated Edison Inc (ED) : Free Stock Analysis Report
