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Amazon (AMZN) Stock Climbs 1.88% Ahead of Earnings: What To Watch
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Shares of Amazon (AMZN - Free Report) surged nearly 2% during regular trading hours Wednesday one day ahead of the release of its second-quarter financial report. So let’s see what investors should expect from the e-commerce firm’s Q2 earnings results after the closing bell Thursday.
Amazon is expected to see its Q2 revenues soar by roughly 41% from the year-ago period to hit $53.45 billion, based on our current Zacks Consensus Estimates. Meanwhile, AMZN’s adjusted quarterly earnings are expected to skyrocket 522% from $0.40 per share to $2.49 per share. But, Amazon has seen mixed earnings estimate revision activity for Q2 over the last 60 days.
With that said, we still need to gauge how likely Amazon is to outperform its earnings estimate. Luckily we can turn to our exclusive Earnings ESP figure to do so.
Zacks Earnings ESP (Expected Surprise Prediction) compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter. The Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change.
This is done because, generally speaking, when an analyst posts an estimate right before an earnings release, it means that they have fresh information which could potentially be more accurate than what analysts thought about a company two or three months ago.
A positive Earnings ESP paired with a Zacks Rank #3 (Hold) or better ranking helps us feel confident about the potential for an earnings beat. In fact, our 10-year backtest has revealed that this methodology has accurately produced a positive surprise 70% of the time.
AMZN’s Most Accurate Estimate—the representation of the most recent analyst sentiment—is calling for earnings of $2.72 per share, which comes in $0.23 above our current $2.49 per share consensus estimate. This figure helps Amazon sport an Earnings ESP of 9.04% and a Zacks Rank #2 (Buy), which means investors can expect AMZN to possibly top Q2 earnings estimates Thursday.
Furthermore, Amazon has topped our quarterly earnings estimates in seven out of the last 10 quarters. However, investors should note that Amazon has either posted a huge earnings beat or a substantial earnings miss during this period.
Make sure to check back here for our full analysis after Amazon reports!
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Amazon (AMZN) Stock Climbs 1.88% Ahead of Earnings: What To Watch
Shares of Amazon (AMZN - Free Report) surged nearly 2% during regular trading hours Wednesday one day ahead of the release of its second-quarter financial report. So let’s see what investors should expect from the e-commerce firm’s Q2 earnings results after the closing bell Thursday.
Everyone knows that Amazon reshaped retail, prompting companies from Walmart (WMT - Free Report) to Target (TGT - Free Report) to change their business models. Meanwhile, Amazon has continued to expand its AWS cloud computing business and looks poised to battle Netflix (NFLX - Free Report) , Hulu, and soon enough Disney (DIS - Free Report) and Apple (AAPL - Free Report) in the streaming video industry (also read: Amazon Web Services: Why Cloud Growth Is Key for AMZN's Q2 Earnings).
Amazon is expected to see its Q2 revenues soar by roughly 41% from the year-ago period to hit $53.45 billion, based on our current Zacks Consensus Estimates. Meanwhile, AMZN’s adjusted quarterly earnings are expected to skyrocket 522% from $0.40 per share to $2.49 per share. But, Amazon has seen mixed earnings estimate revision activity for Q2 over the last 60 days.
With that said, we still need to gauge how likely Amazon is to outperform its earnings estimate. Luckily we can turn to our exclusive Earnings ESP figure to do so.
Zacks Earnings ESP (Expected Surprise Prediction) compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter. The Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change.
This is done because, generally speaking, when an analyst posts an estimate right before an earnings release, it means that they have fresh information which could potentially be more accurate than what analysts thought about a company two or three months ago.
A positive Earnings ESP paired with a Zacks Rank #3 (Hold) or better ranking helps us feel confident about the potential for an earnings beat. In fact, our 10-year backtest has revealed that this methodology has accurately produced a positive surprise 70% of the time.
AMZN’s Most Accurate Estimate—the representation of the most recent analyst sentiment—is calling for earnings of $2.72 per share, which comes in $0.23 above our current $2.49 per share consensus estimate. This figure helps Amazon sport an Earnings ESP of 9.04% and a Zacks Rank #2 (Buy), which means investors can expect AMZN to possibly top Q2 earnings estimates Thursday.
Furthermore, Amazon has topped our quarterly earnings estimates in seven out of the last 10 quarters. However, investors should note that Amazon has either posted a huge earnings beat or a substantial earnings miss during this period.
Make sure to check back here for our full analysis after Amazon reports!
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>