The Zacks Analyst Blog Highlights: CyberArk Software, McDermott International, Markel and Windstream Holdings
For Immediate Release
Chicago, IL – October 30, 2015 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the CyberArk Software, Ltd. (CYBR), McDermott International Inc. (MDR), Markel Corp. (MKL) and Windstream Holdings, Inc. (WIN).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Thursday’s Analyst Blog:
4 Great Stocks Ready to Deliver a Massive Hit This Season
We have already crossed the halfway mark for the third-quarter earnings season, with results from 253 S&P 500 members now on the books. The numbers paint a clear picture of companies’ performance this season, and it is one of almost non-existent growth. Companies are struggling to beat lowered estimates — especially for revenues — and guidance remains on the weaker side.
The Season Thus Far
Total earnings for the 253 S&P 500 members that have already reported so far (which, combined, account for 61.9% of the index’s total market capitalization) have increased about 2.4% from the prior-year period, with revenues 1.4% lower. About 70.5% of these have come out with earnings that topped estimates; with just 42.9% charting revenue beats.
It is obvious that the picture emerging from the third-quarter earnings season is one of all-around weakness. However, there are, as always, some pockets of strength that will stand out among the weaklings.
For instance, we have seen the Technology space exhibit strong earnings power from titans like Apple Inc., Google parent Alphabet Inc. and Microsoft Corp. The Telecom stocks and the airlines space have also displayed good earnings momentum.
So how, and more importantly, why should we identify these pockets of strength?
The Power of Earnings Whispers
You must have noticed how some stocks skyrocket after the earnings results while others fall off a cliff. Studies indicate that on an average, positive earnings surprises drive strong returns in share prices for several weeks following the report.
At Zacks, we have developed a system that beats the earnings estimate consensus more than 70% of the time. This system leverages the Zacks Rank, along with what we call Expected Surprise Prediction, or ESP. When a stock has a favorable Zacks Rank, as well as a positive Earnings ESP, there is a very high chance that a big surprise is in the cards for the company, and investors can get in and ride the ensuing stock appreciation.
4 Stocks Set to Outperform This Season
There are still plenty of potential winners that are yet to report this season, and we want to make sure that you get a big slice of the pie. To help you get on board these potential winners before everyone else, we have capitalized on our proprietary system, integrating our time-tested Zacks Rank and Earnings ESP combination. Also, we have ensured that only those stocks that have consistently beat earnings got through our screen.
Moreover, these champions have delivered staggering earnings beats of over 50% in their last reported quarter — and look set to continue their winning streak and throw another curveball at investors this season.
CyberArk Software, Ltd. (CYBR) provides information technology security solutions, which protect organizational privileged accounts from cyber-attacks. The company recently acquired privately held Viewfinity Inc., which complements its product portfolio and will further boost its capabilities.
Last quarter, this Zacks Rank #2 (Buy) stock reported an astounding 275% positive earnings surprise. In fact, CyberArk has consistently beaten estimates in each of the four trailing quarters, registering an extraordinary average beat of 987.5%.
The Earnings ESP for this stock presently stands at +10.00%. With these time-tested elements in its favour, the company is likely to beat our current EPS consensus of 10 cents and post another huge surprise in its earnings report on Nov 5.
McDermott International Inc. (MDR) is an oil and gas-focused engineering and construction company that stands to benefit greatly from increasing demand for offshore oil and gas construction services, given its strong asset base and attractive geographic presence.
The company has seen a steady flow of contracts in the recent past, the latest being an engineering, procurement, construction and installation contract by Qatar Petroleum. Also, it won a long-term contract from Saudi Aramco in August this year.
McDermotthas delivered huge earnings surprises in three of the four trailing quarters, posting a stellar average surprise of 148.8%. Last quarter, it delivered a 400% earnings beat.
This Zacks Rank #2 stock presently has an Earnings ESP of +20.00%. With a solid Zacks Rank and a positive earnings ESP, the company looks set to beat estimates in its upcoming earnings report on Nov 4.
Markel Corp. (MKL) is a leading global specialty insurer and reinsurer that operates with a strong commitment to provide high quality products and efficient customer service. Markel recently inked a deal to acquire all the assets of CATCo Investment Management Ltd.
CATCo’s specialized business will complement Markel’s traditional reinsurance capabilities, and boost its strategy to expand globally through the inorganic growth route.
Markelhas delivered huge earnings surprises in three of the four trailing quarters, posting an impressive average surprise of 46.5%. This Zacks Rank #1 (Strong Buy) stock has an Earnings ESP of +1.77%.
With a top Zacks Rank and positive ESP, the company looks well poised to beat estimates in its upcoming earnings report on Nov 4.
Windstream Holdings, Inc. (WIN) is a leading provider of advanced network communications and technology solutions, including cloud computing and managed services, to businesses countrywide. Windstream recently decided to sell its data center business for $575 million in cash to TierPoint. The two companies will also cross-promote each other’s products. This will allow Windstream to focus its resources on its core telecom offerings while expanding its footprint in the data center market.
The company has an impressive average beat ratio of 65.8% over the four trailing quarters, and has surpassed estimates by 21.3% in the last reported quarter.
The Zacks Rank #2 stock has an Earnings ESP of +7.50% at the moment. With its impressive combination of a solid Zacks Rank and positive analyst sentiment, this company looks set to continue its winning streak in its upcoming earnings report on Nov 5.
A Winning Strategy
Despite an overall murkiness that the earnings season brought with it, there will be, like always, some companies that will trump all odds and stand out with great earnings surprises. Employing the Zacks' ESP system can significantly increase your odds of discovering these winners before they report and boost your portfolio returns with the ensuing stock price appreciation.
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 >>
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today. Find out What is happening in the stock market today on zacks.com.
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
CYBER-ARK SFTWR (CYBR): Free Stock Analysis Report
MCDERMOTT INTL (MDR): Free Stock Analysis Report
MARKEL CORP (MKL): Free Stock Analysis Report
WINDSTREAM HLDG (WIN): Free Stock Analysis Report
To read this article on Zacks.com click here.
