How to Find Strong Finance Stocks Slated for Positive Earnings Surprises
Wall Street watches a company's quarterly report closely to understand as much as possible about its recent performance and what to expect going forward. Of course, one figure often stands out among the rest: earnings.
We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.
2 Stocks to Add to Your Watchlist
The Zacks Expected Surprise Prediction, or ESP, works by locking in on the most up-to-date analyst earnings revisions because they can be more accurate than estimates from weeks or even months before the actual release date. The thinking is pretty straightforward: analysts who provide earnings estimates closer to the report are likely to have more information. With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the ESP figure.
The final step today is to look at a stock that meets our ESP qualifications. Citigroup (C) earns a Zacks Rank #3 30 days from its next quarterly earnings release on October 13, 2023, and its Most Accurate Estimate comes in at $1.31 a share.
C has an Earnings ESP figure of 1.13%, which, as explained above, is calculated by taking the percentage difference between the $1.31 Most Accurate Estimate and the Zacks Consensus Estimate of $1.30.
C is just one of a large group of Finance stocks with a positive ESP figure. Assurant (AIZ) is another qualifying stock you may want to consider.
Assurant is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on November 7, 2023. AIZ's Most Accurate Estimate sits at $2.98 a share 55 days from its next earnings release.
Assurant's Earnings ESP figure currently stands at 22.03% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $2.44.
Because both stocks hold a positive Earnings ESP, C and AIZ 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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Citigroup Inc. (C) : Free Stock Analysis Report
Assurant, Inc. (AIZ) : Free Stock Analysis Report
