We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Irrespective of whether a company is young or an established one, steady earnings growth is what entices all. This is because earnings serve as a major indicator of a company’s profitability. Take a company’s revenue over a given period of time, subtract the cost of production and, there it is, you have earnings!
This metric is also considered to be the most significant variable in influencing the share price. However, in addition to actual earnings, expectations of earnings play a vital role in determining the share price movement.
Earnings Estimates Shaping Stock Prices
Earnings estimates embody analysts’ opinions of factors such as sales growth, product demand, competitive industry environment, profit margins and cost controls. On numerous occasions, we have seen the stock price decline despite earnings growth, while on the other hand, the stock price is sometimes seen soaring following an earnings decline. This happens because of the missing or beating of estimates.
Thus, earnings estimates serve as a valuable tool while taking investment decisions. Earnings estimates also help an analyst use cash flow analysis to determine the fair value of a firm. Hence, it is important for investors to buy stocks that have historical earnings growth and are also seeing a rise in quarterly and annual earnings estimates.
The Winning Strategy
In order to shortlist stocks that have striking earnings growth and positive estimate revisions, we added the following parameters:
Zacks Rank less than or equal to 2 (Only Zacks' 'Buys' and 'Strong Buys' are allowed. With the Zacks Rank proving itself to be one of the best rating systems out there, this is a great way to start things off.) You can see the complete list of today’s Zacks #1 Rank stocks here.
5-Year Historical EPS Growth (%) greater than X-Industry (Stocks that possess strong EPS growth history.)
% Change EPS F(0)/F(-1) greater than or equal to 5 (Companies that witnessed year-over-year earnings growth rate of 5% or more in the last reported fiscal.)
% Change Q1 Estimates over the last 4 weeks greater than zero(Stocks that have seen their current quarter earnings estimates revised higher in the last 4 weeks.)
% Change F1 Estimates over the last 1 week greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 1 week.)
% Change F1 Estimates over the last 4 weeks greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 4 weeks.)
The above criteria narrowed down the universe of around 7,718 stocks to only 34. Here are the top 5 stocks:
The Cheesecake Factory Incorporated(CAKE - Free Report) operates full-service and casual dining restaurants primarily in the United States. The company’s estimated earnings growth rate for this year is 19.5%.
Thermo Fisher Scientific, Inc. (TMO - Free Report) provides analytical instruments, equipment, reagents and consumables, software, and services for research, manufacturing, analysis, discovery, and diagnostics worldwide. The company’s estimated earnings growth rate for this year is 11.3%.
EMCOR Group Inc. (EME - Free Report) offers electrical and mechanical construction and facilities services to commercial, industrial, utility, and institutional customers primarily in the United States.The company’s estimated earnings growth rate for this year is 16.3%.
CubeSmart (CUBE - Free Report) is an equity real estate investment trust. The company’s estimated earnings growth rate for this year is 14.4%.
CoreLogic, Inc. provides property information, analytics, and data-enabled services in North America, Western Europe, and the Asia Pacific.The company’s estimated earnings growth rate for this year is 27%.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
5 Top Stocks with Imposing Earnings Growth
Irrespective of whether a company is young or an established one, steady earnings growth is what entices all. This is because earnings serve as a major indicator of a company’s profitability. Take a company’s revenue over a given period of time, subtract the cost of production and, there it is, you have earnings!
This metric is also considered to be the most significant variable in influencing the share price. However, in addition to actual earnings, expectations of earnings play a vital role in determining the share price movement.
Earnings Estimates Shaping Stock Prices
Earnings estimates embody analysts’ opinions of factors such as sales growth, product demand, competitive industry environment, profit margins and cost controls. On numerous occasions, we have seen the stock price decline despite earnings growth, while on the other hand, the stock price is sometimes seen soaring following an earnings decline. This happens because of the missing or beating of estimates.
Thus, earnings estimates serve as a valuable tool while taking investment decisions. Earnings estimates also help an analyst use cash flow analysis to determine the fair value of a firm. Hence, it is important for investors to buy stocks that have historical earnings growth and are also seeing a rise in quarterly and annual earnings estimates.
The Winning Strategy
In order to shortlist stocks that have striking earnings growth and positive estimate revisions, we added the following parameters:
Zacks Rank less than or equal to 2 (Only Zacks' 'Buys' and 'Strong Buys' are allowed. With the Zacks Rank proving itself to be one of the best rating systems out there, this is a great way to start things off.) You can see the complete list of today’s Zacks #1 Rank stocks here.
5-Year Historical EPS Growth (%) greater than X-Industry (Stocks that possess strong EPS growth history.)
% Change EPS F(0)/F(-1) greater than or equal to 5 (Companies that witnessed year-over-year earnings growth rate of 5% or more in the last reported fiscal.)
% Change Q1 Estimates over the last 4 weeks greater than zero(Stocks that have seen their current quarter earnings estimates revised higher in the last 4 weeks.)
% Change F1 Estimates over the last 1 week greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 1 week.)
% Change F1 Estimates over the last 4 weeks greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 4 weeks.)
The above criteria narrowed down the universe of around 7,718 stocks to only 34. Here are the top 5 stocks:
The Cheesecake Factory Incorporated(CAKE - Free Report) operates full-service and casual dining restaurants primarily in the United States. The company’s estimated earnings growth rate for this year is 19.5%.
Thermo Fisher Scientific, Inc. (TMO - Free Report) provides analytical instruments, equipment, reagents and consumables, software, and services for research, manufacturing, analysis, discovery, and diagnostics worldwide. The company’s estimated earnings growth rate for this year is 11.3%.
EMCOR Group Inc. (EME - Free Report) offers electrical and mechanical construction and facilities services to commercial, industrial, utility, and institutional customers primarily in the United States.The company’s estimated earnings growth rate for this year is 16.3%.
CubeSmart (CUBE - Free Report) is an equity real estate investment trust. The company’s estimated earnings growth rate for this year is 14.4%.
CoreLogic, Inc. provides property information, analytics, and data-enabled services in North America, Western Europe, and the Asia Pacific.The company’s estimated earnings growth rate for this year is 27%.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Click here to sign up for a free trial to the Research Wizard today.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance
Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »