Yahoo Finance How to Find Strong Computer and Technology Stocks Slated for Positive Earnings Surprises
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.
The earnings figure itself is key, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb even higher.
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.
The final step today is to look at a stock that meets our ESP qualifications. NetApp (NTAP) earns a Zacks Rank #3 22 days from its next quarterly earnings release on February 22, 2023, and its Most Accurate Estimate comes in at $1.34 a share.
NTAP has an Earnings ESP figure of 2.03%, which, as explained above, is calculated by taking the percentage difference between the $1.34 Most Accurate Estimate and the Zacks Consensus Estimate of $1.31.
NTAP is part of a big group of Computer and Technology stocks that boast a positive ESP, and investors may want to take a look at Infosys (INFY) as well.
Slated to report earnings on April 12, 2023, Infosys holds a #3 (Hold) ranking on the Zacks Rank, and it's Most Accurate Estimate is $0.19 a share 71 days from its next quarterly update.
For Infosys, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.19 is 0.87%.
Because both stocks hold a positive Earnings ESP, NTAP and INFY 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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NetApp, Inc. (NTAP) : Free Stock Analysis Report
American Noble Gas Inc. (INFY) : Free Stock Analysis Report
