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Want Better Returns? Don't Ignore These 2 Consumer Discretionary Stocks Set to Beat Earnings

Zacks Equity Research
·2 min read

Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.

Life and the stock market are both about expectations, and rising above what is expected is often rewarded, while falling short can come with negative consequences. Investors might want to try to capture stronger returns by finding positive 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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Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. Comcast (CMCSA) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at $0.93 a share, just 29 days from its upcoming earnings release on October 27, 2022.

CMCSA has an Earnings ESP figure of 3.43%, which, as explained above, is calculated by taking the percentage difference between the $0.93 Most Accurate Estimate and the Zacks Consensus Estimate of $0.89.

CMCSA is one of just a large database of Consumer Discretionary stocks with positive ESPs. Another solid-looking stock is BJ's Wholesale Club (BJ).

BJ's Wholesale Club is a Zacks Rank #1 (Strong Buy) stock, and is getting ready to report earnings on November 17, 2022. BJ's Most Accurate Estimate sits at $0.82 a share 50 days from its next earnings release.

BJ's Wholesale Club's Earnings ESP figure currently stands at 2.98% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.80.

CMCSA and BJ'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
 
Comcast Corporation (CMCSA) : Free Stock Analysis Report
 
BJ's Wholesale Club Holdings, Inc. (BJ) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research