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.
Zacks.com featured expert Kevin Matras highlights: Exact Sciences Corp., Modine Manufacturing, Barnes Group, Owens Corning and Health Insurance Innovations
Read MoreHide Full Article
For Immediate Release
Chicago, IL – October 25, 2017 - Stocks in this week’s article include: Exact Sciences Corp. (EXAS - Free Report) , Modine Manufacturing (MOD - Free Report) , Barnes Group (B - Free Report) , Owens Corning (OC - Free Report) and Health Insurance Innovations . Kevin Matras screens for companies showing their 'first' profit, and explains why they are ones to watch.
Screen of the Week written by Kevin Matras of Zacks Investment Research:
Get Ready to Be Surprised This Earnings Season
With earnings season in full swing, this is a good screen to use both before and after a company reports.
Like any earnings season, we're going to see both positive surprises and negative surprises.
This screen however focuses on more than just earnings surprises, but instead goes over the importance of both earnings surprises and sales surprises, and why as an investor you should care so much about them.
As you know, if a company reports earnings above expectations, that's a positive surprise, and the price in general should go up.
If the company reports earnings below expectations, that's a negative surprise, and the price in general should go down.
But a surprise is more than just a snapshot of an extra few dollars and cents a company made or lost in that one period. Instead, it's a glimpse into what a company's earnings could be, or should be, in the future.
And when these surprises occur, the market tries to quickly re-price that stock to reflect these changes.
Not All Surprises Are Created Equal
Some earnings surprises are due to revenue increases, and other earnings surprises are due to cost cutting measures.
Top line growth (or sales growth) usually produces the biggest price reaction over cost-cutting, because an increase in sales is generally thought of as more sustainable. Once you've cut costs, where’s the future growth going to come from? You can only cut costs so much. You need sales to drive long term growth.
There's also guidance. What the company sees down the road is important.
If you've got a positive surprise on one hand, but then downward guidance on the other, that'll usually produce a negative reaction. Why? Because they've taken away the hope generated from the surprise by saying the future outlook will likely be weaker than expected.
There's also the idea that some surprises aren't really surprises -- either because a company has a history of continuously beating their estimates or the stock has already priced in a 'surprise' by running up or going down prior to the announcement; therefore, the 'surprise' in that direction really wasn't a surprise at all. That's where you'll sometimes see an opposite reaction to an earnings surprise - a "buy the rumor sell the fact" type event.
But while predicting which companies will surprise or not can be difficult, the benefit of an earnings surprise will typically last for one to three months after a surprise is reported.
So you can get in after a company reports a surprise, or you can try and find companies that are more likely to report a surprise, and get in ahead of time.
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.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Contact: Jim Giaquinto Company: Zacks.com Phone: 312-265-9268 Email: pr@zacks.com
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Zacks.com featured expert Kevin Matras highlights: Exact Sciences Corp., Modine Manufacturing, Barnes Group, Owens Corning and Health Insurance Innovations
For Immediate Release
Chicago, IL – October 25, 2017 - Stocks in this week’s article include: Exact Sciences Corp. (EXAS - Free Report) , Modine Manufacturing (MOD - Free Report) , Barnes Group (B - Free Report) , Owens Corning (OC - Free Report) and Health Insurance Innovations . Kevin Matras screens for companies showing their 'first' profit, and explains why they are ones to watch.
Screen of the Week written by Kevin Matras of Zacks Investment Research:
Get Ready to Be Surprised This Earnings Season
With earnings season in full swing, this is a good screen to use both before and after a company reports.
Like any earnings season, we're going to see both positive surprises and negative surprises.
This screen however focuses on more than just earnings surprises, but instead goes over the importance of both earnings surprises and sales surprises, and why as an investor you should care so much about them.
As you know, if a company reports earnings above expectations, that's a positive surprise, and the price in general should go up.
If the company reports earnings below expectations, that's a negative surprise, and the price in general should go down.
But a surprise is more than just a snapshot of an extra few dollars and cents a company made or lost in that one period. Instead, it's a glimpse into what a company's earnings could be, or should be, in the future.
And when these surprises occur, the market tries to quickly re-price that stock to reflect these changes.
Not All Surprises Are Created Equal
Some earnings surprises are due to revenue increases, and other earnings surprises are due to cost cutting measures.
Top line growth (or sales growth) usually produces the biggest price reaction over cost-cutting, because an increase in sales is generally thought of as more sustainable. Once you've cut costs, where’s the future growth going to come from? You can only cut costs so much. You need sales to drive long term growth.
There's also guidance. What the company sees down the road is important.
If you've got a positive surprise on one hand, but then downward guidance on the other, that'll usually produce a negative reaction. Why? Because they've taken away the hope generated from the surprise by saying the future outlook will likely be weaker than expected.
There's also the idea that some surprises aren't really surprises -- either because a company has a history of continuously beating their estimates or the stock has already priced in a 'surprise' by running up or going down prior to the announcement; therefore, the 'surprise' in that direction really wasn't a surprise at all. That's where you'll sometimes see an opposite reaction to an earnings surprise - a "buy the rumor sell the fact" type event.
But while predicting which companies will surprise or not can be difficult, the benefit of an earnings surprise will typically last for one to three months after a surprise is reported.
So you can get in after a company reports a surprise, or you can try and find companies that are more likely to report a surprise, and get in ahead of time.
For the rest of this Screen of the Week article please visit Zacks.com at:https://www.zacks.com/commentary/133559/get-ready-to-be-surprised-this-earnings-season
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.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/ZacksInvestmentResearch
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Contact: Jim Giaquinto
Company: Zacks.com
Phone: 312-265-9268
Email: pr@zacks.com
Visit: www.Zacks.com
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.