Yahoo Finance Why Investors Need to Take Advantage of These 2 Industrial Products Stocks Now
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.
The earnings figure itself is key, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb even higher.
2 Stocks to Add to Your Watchlist
The Zacks Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate. The core of the ESP model is comparing the Most Accurate Estimate to the Zacks Consensus Estimate, where the resulting percentage difference between the two equals the Expected Surprise Prediction.
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. Terex (TEX) earns a Zacks Rank #2 right now and its Most Accurate Estimate sits at $1.18 a share, just 13 days from its upcoming earnings release on May 1, 2023.
Terex's Earnings ESP sits at 12.38%, which, as explained above, is calculated by taking the percentage difference between the $1.18 Most Accurate Estimate and the Zacks Consensus Estimate of $1.05.
TEX is one of just a large database of Industrial Products stocks with positive ESPs. Another solid-looking stock is A.O. Smith (AOS).
A.O. Smith, which is readying to report earnings on April 27, 2023, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently $0.85 a share, and AOS is nine days out from its next earnings report.
The Zacks Consensus Estimate for A.O. Smith is $0.77, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of 10.19%.
TEX and AOS' 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 >>
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Terex Corporation (TEX) : Free Stock Analysis Report
A. O. Smith Corporation (AOS) : Free Stock Analysis Report
