Back to top

Why CA Technologies (CA) is Poised to Beat Earnings Estimates (Again)
January 27, 2014

Read MoreHide Full Article
Looking for a stock that might be in a good position to beat earnings at its next report? Consider CA Technologies (CA - Free Report) , a firm in the Business Software & Services industry, 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, CA has beaten estimates by at least 15% in both cases, suggesting it has a nice short-term history of crushing expectations.

Earnings in Focus

Two quarters ago, CA expected to earn 68 cents per share, while it actually produced earnings of 83 cents per share, a beat of 22.1%. Meanwhile, for the most recent quarter, the company looked to deliver earnings of 68 cents per share, when it actually saw earnings of 80 cents per share instead, representing a 17.7% positive surprise.

Thanks in part to this history, recent estimates have been moving higher for CA Technologies. In fact, the Earnings ESP for CA 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 CA , as the firm currently has a Zacks Earnings ESP of 1.72%, so another beat could be around the corner.

This is particularly true when you consider that CA 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 CA could see another beat at its next report, especially if recent trends are any guide.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>


In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

CA Inc. (CA) - free report >>

More from Zacks Tale of the Tape

You May Like