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5 High-Flying Stocks to Buy Ahead of Earnings Next Week

Nalak Das

Wall Street is firing on all cylinders since the beginning of this year, breaking one record after another. It seems that the bulls have no intention of taking a breather after completing the best year in the last six years. This year’s momentum starts from where it ended in 2019.

Although several large-cap (market capital >10 billion) stocks have skyrocketed in the past year, some of them are set to beat earnings estimate in the ongoing reporting cycle. Strong earnings results will likely ensure further northbound move in the stock prices of these companies in the near term.

Weak Expectations for Fourth-Quarter Earnings

Expectations for fourth-quarter 2019 earnings are far from encouraging at present. However, although corporate earnings growth was negative year over year in the first three quarters, results were far better than initially anticipated.

Total earnings of the S&P 500 Index are anticipated to be down 3.2% from the same period last year on 3.5% higher revenues. As of Jan 20, just 44 S&P 500 members reported fourth-quarter earnings results. Total earnings of these companies are down 3.8% from the same period last year on 3.9% higher revenues. Of the total, 75% surpassed EPS estimates while 70.5% outpaced revenue estimates. (Read More: Are Earnings Reports Just OK, or Better than Expected?)

5 Large-Cap Stocks Set to Beat on Earnings Next Week

Below are five 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 a Zacks Rank # 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 five picks in the past year.

Apple Inc. AAPL designs, manufactures and sells iPhone, iPad, iPod, Apple TV, Mac personal computers, Apple Watch, HomePod and AirPods. These devices are powered by software applications including iOS, macOS, watchOS and tvOS operating systems. The company has an Earnings ESP of +4.08% for the first quarter of fiscal 2020 (ended December 2019).

Apple has an expected earnings growth rate of 10.7% for the current year (ending September 2020). The Zacks Consensus Estimate for the current year has improved 0.7% over the last 60 days. The trailing four-quarter positive earnings surprise is 3.6%, on average. Apple is set to release earnings results on Jan 28, after the closing bell.

W. R. Berkley Corp. WRB is an insurance holding company, operates as a commercial lines writer in the United States and internationally. It operates through two segments, Insurance and Reinsurance. The company has an Earnings ESP of +2.03% for fourth-quarter 2019.

The Zacks Consensus Estimate for the current year has improved 0.7% over the last 60 days. The last four-quarter positive earnings surprise is 32.3%, on average. W. R. Berkley is set to release earnings results on Jan 28, after the closing bell.

Tesla Inc. TSLA designs, develops, manufactures, and sells electric vehicles, and energy generation and storage systems in the United States, China, Netherlands, Norway, and internationally. The company operates in two segments, Automotive and Energy Generation and Storage. The company has an Earnings ESP of +3.34% for fourth-quarter 2019.

Tesla has an expected earnings growth rate of 6,386.1% for the current year. The Zacks Consensus Estimate for the current year has improved 9.6% over the last 60 days. The trailing four-quarter positive earnings surprise is 271.4%, on average. Tesla is set to release earnings results on Jan 29, after the closing bell.

MSCI Inc. MSCI provides investment-decision-supporting tools for clients to manage their investment processes worldwide. It operates through four segments: Index, Analytics, ESG and Real Estate. The company has an Earnings ESP of +0.51% for fourth-quarter 2019.

MSCI has an expected earnings growth rate of 12.5% for the current year. The Zacks Consensus Estimate for the current year has improved 0.6% over the last 60 days. The positive earnings surprise for the trailing four quarters is 4.9%, on average. MSCI is set to release earnings results on Jan 30, before the opening bell.

Parker-Hannifin Corp. HP manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide. It operates in two segments, Diversified Industrial and Aerospace Systems. The company has an Earnings ESP of +0.44% for the second quarter of fiscal 2020 (ended December 2019).

The Zacks Consensus Estimate for the current year (ending June 2020) has improved 0.9% over the last 60 days. The trailing four-quarter positive earnings surprise is 5.3%, on average. Parker-Hannifin is set to release earnings results on Jan 30, before the opening bell.

Just Released: Zacks’ 7 Best Stocks for Today

Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.6% per year.

These 7 were selected because of their superior potential for immediate breakout.

See these time-sensitive tickers now >>


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MSCI Inc (MSCI) : Free Stock Analysis Report
 
Tesla, Inc. (TSLA) : Free Stock Analysis Report
 
Apple Inc. (AAPL) : Free Stock Analysis Report
 
W.R. Berkley Corporation (WRB) : Free Stock Analysis Report
 
Helmerich & Payne, Inc. (HP) : Free Stock Analysis Report
 
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