U.S. Markets closed
  • S&P Futures

    4,208.25
    -38.25 (-0.90%)
     
  • Dow Futures

    33,952.00
    -336.00 (-0.98%)
     
  • Nasdaq Futures

    13,867.75
    -162.50 (-1.16%)
     
  • Russell 2000 Futures

    2,296.60
    -19.10 (-0.82%)
     
  • Crude Oil

    72.00
    -0.12 (-0.17%)
     
  • Gold

    1,838.60
    -17.80 (-0.96%)
     
  • Silver

    27.48
    -0.21 (-0.77%)
     
  • EUR/USD

    1.2022
    -0.0111 (-0.9137%)
     
  • 10-Yr Bond

    1.5690
    +0.0700 (+4.67%)
     
  • Vix

    18.24
    +1.22 (+7.17%)
     
  • GBP/USD

    1.4009
    -0.0074 (-0.5239%)
     
  • USD/JPY

    110.4730
    +0.4390 (+0.3990%)
     
  • BTC-USD

    38,463.92
    -1,524.27 (-3.81%)
     
  • CMC Crypto 200

    955.07
    -37.40 (-3.77%)
     
  • FTSE 100

    7,184.95
    +12.47 (+0.17%)
     
  • Nikkei 225

    29,291.01
    -150.29 (-0.51%)
     

Top 5 Nasdaq Stocks Set to Beat Earnings Estimate This Week

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·6 min read
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

The first-quarter 2021 earnings season will gather pace this week as more than 875 companies are slated to release their financial numbers. Notably, market participants are eagerly waiting for the earnings results of five big techs. Aside from those, several Nasdaq Composite-isted tech companies are expected to report this week, with some showing chances of beating their earnings estimates. A handful of these stocks currently carries a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).

A Quick Glance at Nasdaq Composite in Q1

The Nasdaq Composite — the main driver that pushed Wall Street out of the coronavirus-led short bear market and helped the most to form a new bull market in the pandemic-ridden 2020 — lost momentum in first-quarter 2021. The Nasdaq Composite rose 2.8% last quarter, lagging the Dow and the S&P 500 that gained 7.8% and 5.8%, respectively.

There were two reasons. First, the U.S. government has intensified the nationwide deployment of COVID-19 vaccines and three FDA-approved vaccine manufacturers have ramped up productions.

With the possibility of a faster-than-expected reopening of the U.S. economy, market participants shifted from technology to cyclical stocks like industrials, financials, materials, consumer discretionary and oil & energy that were trading at cheap prices at the beginning of this year.

Second, Wall Street's astonishing rally for the past year prompted investors to shift the allotment of funds from safe-haven government bonds to risky equities. Consequently, yields on the 10-Year U.S. Treasury Note and 30-Year U.S. Treasury Note have spiked.

High risk-free return is detrimental to high-growth industries like technology. Most of the growth companies depend on easy borrowing at cheap rates. A higher market interest rate will raise their cost of projects. As a result, investors reallocated their funds to cyclical stocks from growth stocks.

Impressive Q1 Earnings So Far

The first-quarter 2021 earnings season has started with much vigor. As of Apr 23, 123 S&P 500 companies reported results. Total earnings of these companies are up 46.7% year over year on 5.1% higher revenues, with 83.7% companies having surpassed EPS estimates and 75.6% beating on revenues.

For the first quarter as a whole, total earnings of the S&P 500 companies are expected to be up 28.1% from the same period last year on 6.3% higher revenues. These estimates were favorably compared with the 30.2% jump in earnings on 6.6% higher revenues estimated at the beginning of the reporting cycle. (Read More: Previewing Big Tech Earnings)

Our Top Picks

We have narrowed down our search to five Nasdaq Composite listed technology stocks slated to release earnings results this week. Each of these stocks carries a Zacks Rank #2 and has a positive Earnings ESP. You can see the complete list of today’s Zacks #1 Rank stocks here.

Our research shows that for stocks with the combination of a Zacks Rank #3 or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after the earnings releases. 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 last quarter.

Perficient Inc. PRFT provides information technology and management consulting services in the United States. It designs, builds, and delivers solutions using middleware software products developed by third-party vendors. The company has an Earnings ESP of +1.47% for first-quarter 2021.

Perficient has an expected earnings growth rate of 17.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 8.5% over the last 60 days. It has a trailing four-quarter earnings surprise of 10.3%, on average. The company is set to release earnings results on Apr 29, before the opening bell.

Citrix Systems Inc. CTXS is a leading provider of virtualization, networking and cloud computing solutions to more than 400,000 organizations worldwide. It offers secure digital workspace technologies which are cloud-based, and can be managed across both hybrid and multi-cloud infrastructures. The company has an Earnings ESP of +0.15% for first-quarter 2021.

Citrix Systems has an expected earnings growth rate of 4.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 12.5% over the last 7 days. It has a trailing four-quarter earnings surprise of 24.3%, on average. The company is set to release earnings results on Apr 29, before the opening bell.

Texas Instruments Inc. TXN designs, manufactures and sells semiconductors to electronics designers and manufacturers worldwide. The company is seeing particular success in certain fast-growing segments of the automotive market. It operates in two segments, Analog and Embedded Processing. The company has an Earnings ESP of +4.25% for first-quarter 2021.

Texas Instruments has an expected earnings growth rate of 13.4% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.3% over the last 30 days. It has a trailing four-quarter earnings surprise of 34.9%, on average. The company is set to release earnings results on Apr 27, after the closing bell.

Avnet Inc. AVT is a technology solutions company that markets, sells and distributes electronic components. It operates through two segments, Electronic Components and Farnell. The company has an Earnings ESP of +0.89% for third-quarter fiscal 2021 (ended March 2021).

Avnet has an expected earnings growth rate of 31.2% for the current year (ending June 2021). The Zacks Consensus Estimate for current-year earnings has improved 1% over the last 30 days. It has a trailing four-quarter earnings surprise of more than 100%, on average. The company is set to release earnings results on Apr 28, after the closing bell.

MACOM Technology Solutions Holdings Inc. MTSI designs and manufactures analog radio frequency, microwave, millimeterwave, and lightwave spectrum products in the United States, China, the Asia Pacific, and internationally. The company has an Earnings ESP of +1.17% for second-quarter fiscal 2021 (ended March 2021).

MACOM Technology has an expected earnings growth rate of 92.9% for the current year (ending September 2021). The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the last 30 days. It has a trailing four-quarter earnings surprise of 35.5%, on average. The company is set to release earnings results on Apr 29, before the opening bell.

Zacks' Top Picks to Cash in on Artificial Intelligence

In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.

See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Avnet, Inc. (AVT) : Free Stock Analysis Report

Citrix Systems, Inc. (CTXS) : Free Stock Analysis Report

Texas Instruments Incorporated (TXN) : Free Stock Analysis Report

Perficient, Inc. (PRFT) : Free Stock Analysis Report

MACOM Technology Solutions Holdings, Inc. (MTSI) : Free Stock Analysis Report

To read this article on Zacks.com click here.