Want Better Returns? Don't Ignore These 2 Auto-Tires-Trucks Stocks Set to Beat Earnings
Earnings are arguably the most important single number on a company's quarterly financial report. Wall Street clearly dives into all of the other metrics and management's input, but the EPS figure helps cut through all the noise.
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 Earnings ESP is more formally known as the Expected Surprise Prediction, and it aims to grab the inside track on the latest analyst estimate revisions ahead of a company's report. The idea is relatively intuitive as a newer projection might be based on more complete information. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.
The final step today is to look at a stock that meets our ESP qualifications. BorgWarner (BWA) earns a Zacks Rank #3 nine days from its next quarterly earnings release on November 2, 2023, and its Most Accurate Estimate comes in at $0.94 a share.
BWA has an Earnings ESP figure of 4.03%, which, as explained above, is calculated by taking the percentage difference between the $0.94 Most Accurate Estimate and the Zacks Consensus Estimate of $0.90.
BWA is one of just a large database of Auto-Tires-Trucks stocks with positive ESPs. Another solid-looking stock is Cummins (CMI).
Cummins is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on November 2, 2023. CMI's Most Accurate Estimate sits at $4.70 a share nine days from its next earnings release.
For Cummins, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $4.69 is 0.17%.
Because both stocks hold a positive Earnings ESP, BWA and CMI 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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BorgWarner Inc. (BWA) : Free Stock Analysis Report
Cummins Inc. (CMI) : Free Stock Analysis Report
