These 2 Finance Stocks Could Beat Earnings: Why They Should Be on Your Radar
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 Earnings ESP is more formally known as the Expected Surprise Prediction, and it aims to grab the inside track on the latest analyst estimate revisions ahead of a company's report. The idea is relatively intuitive as a newer projection might be based on more complete information. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.
The final step today is to look at a stock that meets our ESP qualifications. Goosehead Insurance (GSHD) earns a Zacks Rank #3 19 days from its next quarterly earnings release on July 26, 2023, and its Most Accurate Estimate comes in at $0.34 a share.
By taking the percentage difference between the $0.34 Most Accurate Estimate and the $0.29 Zacks Consensus Estimate, Goosehead Insurance has an Earnings ESP of 15.65%.
GSHD is part of a big group of Finance stocks that boast a positive ESP, and investors may want to take a look at Main Street Capital (MAIN) as well.
Main Street Capital, which is readying to report earnings on August 3, 2023, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently $1.02 a share, and MAIN is 27 days out from its next earnings report.
The Zacks Consensus Estimate for Main Street Capital is $0.99, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of 3.29%.
Because both stocks hold a positive Earnings ESP, GSHD and MAIN 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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Goosehead Insurance (GSHD) : Free Stock Analysis Report
Main Street Capital Corporation (MAIN) : Free Stock Analysis Report
