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MARKETS LIVE BLOG:

STOCKS WOBBLE AFTER COOLING U.S. PCE DATA RAISE FED HOPES

Fed's preferred inflation gauge shows prices rose at slowest pace since March 2021

How to Boost Your Portfolio with Top Computer and Technology Stocks Set to Beat Earnings

Zacks Equity Research
·2 min read

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.

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.

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The last thing we will do today, now that we have a grasp on the ESP and how powerful of a tool it can be, is to look at a qualifying stock. AppFolio (APPF) holds a Zacks Rank #2 at the moment and its Most Accurate Estimate comes in at $0.95 a share 30 days away from its upcoming earnings release on July 25, 2024.

APPF has an Earnings ESP figure of 2.98%, which, as explained above, is calculated by taking the percentage difference between the $0.95 Most Accurate Estimate and the Zacks Consensus Estimate of $0.92.

APPF is just one of a large group of Computer and Technology stocks with a positive ESP figure. Lyft (LYFT) is another qualifying stock you may want to consider.

Lyft, which is readying to report earnings on August 13, 2024, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently $0.19 a share, and LYFT is 49 days out from its next earnings report.

For Lyft, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.19 is 2.52%.

APPF and LYFT'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 >>

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

AppFolio, Inc. (APPF) : Free Stock Analysis Report

Lyft, Inc. (LYFT) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research