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

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.

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.

The final step today is to look at a stock that meets our ESP qualifications. Annaly Capital Management (NLY) earns a Zacks Rank #2 28 days from its next quarterly earnings release on October 26, 2022, and its Most Accurate Estimate comes in at $3.84 a share.

Annaly Capital Management's Earnings ESP sits at 92%, which, as explained above, is calculated by taking the percentage difference between the $3.84 Most Accurate Estimate and the Zacks Consensus Estimate of $2.

NLY is one of just a large database of Finance stocks with positive ESPs. Another solid-looking stock is MetLife (MET).

MetLife is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on November 2, 2022. MET's Most Accurate Estimate sits at $1.49 a share 35 days from its next earnings release.

The Zacks Consensus Estimate for MetLife is $1.34, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of 11.05%.

NLY and MET's positive ESP metrics may signal that a positive earnings surprise for both stocks is on the horizon.

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
 
Annaly Capital Management Inc (NLY) : Free Stock Analysis Report
 
MetLife, Inc. (MET) : Free Stock Analysis Report
 
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Zacks Investment Research