Looking for Stocks with Positive Earnings Momentum? Check Out These 2 Basic Materials Names
Two factors often determine stock prices in the long run: earnings and interest rates. Investors can't control the latter, but they can focus on a company's earnings results every quarter.
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 Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate. The core of the ESP model is comparing the Most Accurate Estimate to the Zacks Consensus Estimate, where the resulting percentage difference between the two equals the Expected Surprise Prediction.
The final step today is to look at a stock that meets our ESP qualifications. Westlake Chemical (WLK) earns a Zacks Rank #1 zero days from its next quarterly earnings release on May 3, 2022, and its Most Accurate Estimate comes in at $5.31 a share.
By taking the percentage difference between the $5.31 Most Accurate Estimate and the $4.70 Zacks Consensus Estimate, Westlake Chemical has an Earnings ESP of 12.98%.
WLK is just one of a large group of Basic Materials stocks with a positive ESP figure. DuPont de Nemours (DD) is another qualifying stock you may want to consider.
DuPont de Nemours, which is readying to report earnings on May 3, 2022, sits at a Zacks Rank #5 (Strong Sell) right now. It's Most Accurate Estimate is currently $0.67 a share, and DD is zero days out from its next earnings report.
For DuPont de Nemours, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.67 is 0.35%.
WLK and DD's positive ESP figures tell us that both stocks have a good chance at beating analyst expectations in their next earnings report.
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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Westlake Corp. (WLK) : Free Stock Analysis Report
DuPont de Nemours, Inc. (DD) : Free Stock Analysis Report
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