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Why Earnings Season Could Be Great for Square (SQ)
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Investors are always looking for stocks that are poised to beat at earnings season and Square (SQ - Free Report) may be one such company. The firm has earnings coming up pretty soon, and events are shaping up quite nicely for their report.
That is because Square is seeing favorable earnings estimate revision activity as of late, which is generally a precursor to an earnings beat. After all, analysts raising estimates right before earnings—with the most up-to-date information possible—is a pretty good indicator of some favorable trends underneath the surface for SQ in this report.
In fact, the Most Accurate Estimate for the current quarter is currently at a loss of 7 cents per share for SQ, compared to a broader Zacks Consensus Estimate of a loss of 8 cents per share. This suggests that analysts have very recently bumped up their estimates for SQ, giving the stock a Zacks Earnings ESP of 12.50% heading into earnings season.
A positive reading for the Zacks Earnings ESP has proven to be very powerful in producing both positive surprises, and outperforming the market. Our recent 10 year backtest shows that stocks that have a positive Earnings ESP and a Zacks Rank #3 (Hold) or better show a positive surprise nearly 70% of the time, and have returned over 28% on average in annual returns (see more Top Earnings ESP stocks here).
Clearly, recent earnings estimate revisions suggest that good things are ahead for Square, and that a beat might be in the cards for the upcoming report.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500.
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Why Earnings Season Could Be Great for Square (SQ)
Investors are always looking for stocks that are poised to beat at earnings season and Square (SQ - Free Report) may be one such company. The firm has earnings coming up pretty soon, and events are shaping up quite nicely for their report.
That is because Square is seeing favorable earnings estimate revision activity as of late, which is generally a precursor to an earnings beat. After all, analysts raising estimates right before earnings—with the most up-to-date information possible—is a pretty good indicator of some favorable trends underneath the surface for SQ in this report.
In fact, the Most Accurate Estimate for the current quarter is currently at a loss of 7 cents per share for SQ, compared to a broader Zacks Consensus Estimate of a loss of 8 cents per share. This suggests that analysts have very recently bumped up their estimates for SQ, giving the stock a Zacks Earnings ESP of 12.50% heading into earnings season.
Square, Inc. Price and EPS Surprise
Square, Inc. Price and EPS Surprise | Square, Inc. Quote
Why is this Important?
A positive reading for the Zacks Earnings ESP has proven to be very powerful in producing both positive surprises, and outperforming the market. Our recent 10 year backtest shows that stocks that have a positive Earnings ESP and a Zacks Rank #3 (Hold) or better show a positive surprise nearly 70% of the time, and have returned over 28% on average in annual returns (see more Top Earnings ESP stocks here).
Given that SQ has a Zacks Rank #3 and an ESP in positive territory, investors might want to consider this stock ahead of earnings. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Clearly, recent earnings estimate revisions suggest that good things are ahead for Square, and that a beat might be in the cards for the upcoming report.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500.
See today's Zacks "Strong Sells" absolutely free >>.