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4 Top-Ranked Stocks Poised to Beat on Q4 Earnings Next Week

Nalak Das

Wall Street is firing on all cylinders since the beginning of this year, breaking one record after another. This year’s momentum started from where it ended in 2019. Although corporate earnings growth was negative year over year in the first three quarters of last year, results were far better than initially anticipated. For the fourth quarter also, earnings trends are improving as companies are coming up with their reports.

Fourth-Quarter Earnings Results Improving  

Expectations for fourth-quarter 2019 earnings are far from encouraging at present. As of Jan 23, just 75 S&P 500 members reported fourth-quarter earnings results. Total earnings of these companies are down 1.3% from the same period last year on 3.2% higher revenues. Of the total, 69.3% surpassed EPS estimates while 72% outpaced revenue estimates.

As of Jan 23, total earnings of the S&P 500 Index are anticipated to be down 3% from the same period last year on 3.7% higher revenues. This is an improvement from earnings decline of 3.2% from the same period last year on 3.5% higher revenues, projected at the beginning of the reporting cycle.  (Read More: Q4 Results Show Improving Earnings Picture)

4 Stocks to Consider Ahead of Earnings Releases

Below are four stocks set to beat on earnings next week. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases their chances of an earnings beat. Each of our picks carries either a Zacks Rank #1 or 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

The chart below shows the price performance of our four picks in the past three months.

Lear Corp. LEA designs, develops, engineers, manufactures, assembles and supplies automotive seating, and electrical distribution systems and related components for automotive original equipment manufacturers worldwide. The Zacks Rank #2 company has an Earnings ESP of +10.04%.

Lear Corp. has an expected earnings growth rate of 9.9% for the current year. The trailing four-quarter positive earnings surprise is 3.3%, on average. The company is set to release earnings results on Jan 28, before the opening bell.

SEI Investments Co. SEIC is a leading provider of wealth management business solutions in the financial services industry. It offers investment processing, management and operations solutions globally. The Zacks Rank #1 company has an Earnings ESP of +2.35%.

SEI Investments has an expected earnings growth rate of 13.4% for the current year. The Zacks Consensus Estimate for the current year has improved 3.4% over the last 30 days. The last four-quarter positive earnings surprise is 0.9%, on average. SEI Investments is set to release earnings results on Jan 29, after the closing bell.

Alexion Pharmaceuticals Inc. ALXN is a biopharmaceutical company focused on the development and commercialization of life-transforming drugs, for the treatment of patients with ultra-rare disorders. The Zacks Rank #1 company has an Earnings ESP of +5.54%.

Alexion Pharmaceuticals has an expected earnings growth rate of 8.7% for the current year. The Zacks Consensus Estimate for the current year has improved 1.4% over the last 30 days. The trailing four-quarter positive earnings surprise is 12.5%, on average. Alexion Pharmaceuticals is set to release earnings results on Jan 30, before the opening bell.

Apartment Investment and Management Co. AIV is a real estate investment trust focused on the ownership and management of quality apartment communities located in select markets in the United States. The Zacks Rank #2 company has an Earnings ESP of +0.77%.

Apartment Investment and Management has an expected earnings growth rate of 6.6% for the current year. The Zacks Consensus Estimate for the current year has improved 0.8% over the last 30 days. Apartment Investment and Management is set to release earnings results on Jan 30, after the closing bell.

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