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Should You Buy ABM Industries (ABM) Ahead of Earnings?

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Looking for a stock that might be in a good position to beat earnings at its next report? Consider ABM Industries Incorporated (ABM - Free Report) , a firm in the Building-Maintenance & Services, which could be a great candidate for another beat.

This company has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. In fact, in these reports, ABM has beaten estimates by at least 10% in both cases, suggesting it has a nice short-term history of crushing expectations.

Earnings in Focus

Two quarters ago, ABM expected to earn 26 cents per share, while it actually produced earnings of 38 cents per share, a beat of 46.2%. Meanwhile, for the most recent quarter, the company looked to deliver earnings of 28 cents per share, when it actually saw earnings of 31 cents per share instead, representing a 10.7% positive surprise.

ABM INDUSTRIES Price and EPS Surprise

ABM INDUSTRIES Price and EPS Surprise | ABM INDUSTRIES Quote

Thanks in part to this history, recent estimates have been moving higher for ABM Industries. In fact, the Earnings ESP for ABM is positive, which is a great sign of a coming beat.

After all, the Zacks Earnings ESP compares the most accurate estimate to the broad consensus, looking to find stocks that have seen big revisions as of late, suggesting that analysts have recently become more bullish on the company’s earnings prospects. This is the case for ABM, as the firm currently has a Zacks Earnings ESP of 2.63%, so another beat could be around the corner.

This is particularly true when you consider that ABM has a great Zacks Rank #2 (Buy) which can be a harbinger of outperformance and a signal for a strong earnings profile. And when you add this solid Zacks Rank to a positive Earnings ESP, a positive earnings surprise happens nearly 70% of the time, so it seems pretty likely that ABM could see another beat at its next report, especially if recent trends are any guide.

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