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5 Large-Cap Stocks Set to Beat on Q4 Earnings This Week
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We are in the second half of the fourth quarter 2022 earnings season. This week will be the last big one of this reporting cycle with as many as 1163 companies slated to release their quarterly financial numbers. So far, the results have been mostly in line with expectations.
We have selected five large-cap stocks with a favorable Zacks Rank that are poised to beat earnings estimates. The combination of a favorable Zacks Rank and a possible earnings beat should drive their stock prices in the near term. These companies are Exact Sciences Corp. (EXAS - Free Report) , Teck Resources Ltd. (TECK - Free Report) , GFL Environmental Inc. (GFL - Free Report) , Lincoln Electric Holdings Inc. (LECO - Free Report) and NiSource Inc. (NI - Free Report) .
Q4 Earnings Season So Far
As of Feb 17, 407 S&P 500 companies have reported their results. Total earnings of these companies are down 5.5% year over year on 5.9% higher revenues, with 70.3% beating EPS estimates and 71.3% beating revenue estimates. Our current projection shows that for fourth-quarter 2022, total earnings of the S&P 500 Index as a whole are expected to decline 5.7% year over year on 5.5% higher revenues.
Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after their earnings releases. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The chart below shows the price performance of our five picks in the last quarter.
Image Source: Zacks Investment Research
Exact Sciences has been benefitting from robust revenues from the Screening and Precision Oncology segments. EXAS noted that more than 292,000 healthcare providers ordered Cologuard from its launch till the end of September. The growing uptake of EXAS’ Oncotype DX Breast and therapy selection products is a major advantage.
Exact Sciences has an Earnings ESP of +13.21%. It has an expected earnings growth rate of 29.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.3% over the past 30 days.
EXAS recorded earnings surprises in three out of the last four reported quarters, with an average beat of 0.6%. The company is set to release results on Feb 21, after the closing bell.
Teck Resources has a portfolio of world-class assets in stable jurisdictions and a solid pipeline of projects. Once completed, TECK’s QB2 project will transform its copper business, making it a major global copper concentrate producer. The next phase of the project will be the Quebrada Blanca Mill Expansion (QBME), which will increase concentrator throughput of approximately 50%.
The QBME feasibility study, including all environmental baseline activities, is progressing well, with completion targeted in 2023. QBME is expected to be a significant contributor to Teck Resources’ near-term copper growth portfolio, with the first production targeted for 2026. TECK expects copper production to be in the range of 170,000 and 300,000 tons per year from the QB2 project from 2023 to 2025.
Teck Resources has an Earnings ESP of +0.17%. The Zacks Consensus Estimate for current-year earnings has improved 0.2% over the past seven days. TECK recorded an earnings surprise in three out of the last four reported quarters, with an average beat of 3.7%. The company is set to release earnings on Feb 20, after the closing bell.
GFL Environmental operates as a diversified environmental services company in Canada and the United States. GFL offers non-hazardous solid waste management, infrastructure and soil remediation, and liquid waste management services.
GFL’s solid waste management business line includes the collection, transportation, transfer, recycling, and disposal of non-hazardous solid waste for municipal, residential, and commercial and industrial customers.
GFL Environmental has an Earnings ESP of +15.00%. It has an expected earnings growth rate of 30.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.8% over the past 30 days.
GFL recorded earnings surprises in the last four reported quarters, with an average beat of 203.2%. The company is set to release earnings on Feb 21, after the closing bell.
Lincoln Electric has been benefiting from improving demand in all its end markets, as reflected in solid order levels coupled with record backlogs for equipment systems and automation solutions. Inflated material costs and persistent supply-chain issues are expected to have weighed on its margin performance in the near term. Nevertheless, LECO’s pricing actions are likely to have somewhat negated this impact on margins.
Acquisitions to augment its capabilities and geographical footprint as well as focus on developing new products and utilization of digital platforms to engage customers are likely to have driven LECO’s top-line performance. Lincoln Electric's product launches in the promising automation solutions market are likely to have aided growth as well.
LECO has an Earnings ESP of +2.71%. It has an expected earnings growth rate of 4.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 30 days.
Lincoln Electric recorded an earnings surprise in the last four reported quarters, with an average beat of 11.6%. The company is set to release earnings on Feb 21, before the opening bell.
NiSource expects to invest $40 billion in the long-term utility infrastructure modernization program. The existing capex plans will further enhance the reliability of natural gas and electric operations, and help the company offer efficient services to NI’s expanding customer base.
NiSource continues to increase its clean power assets. Moreover, nearly 75% of NI’s investment is recovered within 18 months through rate hikes, which provides the necessary funds to carry on infrastructure upgrade projects.
NiSource has an Earnings ESP of +1.03%. It has an expected earnings growth rate of 6.4% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.6% over the past 60 days.
NI recorded earnings surprises in two out the last four reported quarters, with the average beat being 0.3%. The company is set to release earnings on Feb 22, before the opening bell.
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5 Large-Cap Stocks Set to Beat on Q4 Earnings This Week
We are in the second half of the fourth quarter 2022 earnings season. This week will be the last big one of this reporting cycle with as many as 1163 companies slated to release their quarterly financial numbers. So far, the results have been mostly in line with expectations.
We have selected five large-cap stocks with a favorable Zacks Rank that are poised to beat earnings estimates. The combination of a favorable Zacks Rank and a possible earnings beat should drive their stock prices in the near term. These companies are Exact Sciences Corp. (EXAS - Free Report) , Teck Resources Ltd. (TECK - Free Report) , GFL Environmental Inc. (GFL - Free Report) , Lincoln Electric Holdings Inc. (LECO - Free Report) and NiSource Inc. (NI - Free Report) .
Q4 Earnings Season So Far
As of Feb 17, 407 S&P 500 companies have reported their results. Total earnings of these companies are down 5.5% year over year on 5.9% higher revenues, with 70.3% beating EPS estimates and 71.3% beating revenue estimates. Our current projection shows that for fourth-quarter 2022, total earnings of the S&P 500 Index as a whole are expected to decline 5.7% year over year on 5.5% higher revenues.
Our Top Picks
The following five large-cap (market Capital > $10 Billion) stocks are set to beat Q4 earnings estimates this week. Each of these stocks carries a Zacks Rank #2 (Buy) and has a positive Earnings ESP. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after their earnings releases. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The chart below shows the price performance of our five picks in the last quarter.
Image Source: Zacks Investment Research
Exact Sciences has been benefitting from robust revenues from the Screening and Precision Oncology segments. EXAS noted that more than 292,000 healthcare providers ordered Cologuard from its launch till the end of September. The growing uptake of EXAS’ Oncotype DX Breast and therapy selection products is a major advantage.
Exact Sciences has an Earnings ESP of +13.21%. It has an expected earnings growth rate of 29.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.3% over the past 30 days.
EXAS recorded earnings surprises in three out of the last four reported quarters, with an average beat of 0.6%. The company is set to release results on Feb 21, after the closing bell.
Teck Resources has a portfolio of world-class assets in stable jurisdictions and a solid pipeline of projects. Once completed, TECK’s QB2 project will transform its copper business, making it a major global copper concentrate producer. The next phase of the project will be the Quebrada Blanca Mill Expansion (QBME), which will increase concentrator throughput of approximately 50%.
The QBME feasibility study, including all environmental baseline activities, is progressing well, with completion targeted in 2023. QBME is expected to be a significant contributor to Teck Resources’ near-term copper growth portfolio, with the first production targeted for 2026. TECK expects copper production to be in the range of 170,000 and 300,000 tons per year from the QB2 project from 2023 to 2025.
Teck Resources has an Earnings ESP of +0.17%. The Zacks Consensus Estimate for current-year earnings has improved 0.2% over the past seven days. TECK recorded an earnings surprise in three out of the last four reported quarters, with an average beat of 3.7%. The company is set to release earnings on Feb 20, after the closing bell.
GFL Environmental operates as a diversified environmental services company in Canada and the United States. GFL offers non-hazardous solid waste management, infrastructure and soil remediation, and liquid waste management services.
GFL’s solid waste management business line includes the collection, transportation, transfer, recycling, and disposal of non-hazardous solid waste for municipal, residential, and commercial and industrial customers.
GFL Environmental has an Earnings ESP of +15.00%. It has an expected earnings growth rate of 30.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.8% over the past 30 days.
GFL recorded earnings surprises in the last four reported quarters, with an average beat of 203.2%. The company is set to release earnings on Feb 21, after the closing bell.
Lincoln Electric has been benefiting from improving demand in all its end markets, as reflected in solid order levels coupled with record backlogs for equipment systems and automation solutions. Inflated material costs and persistent supply-chain issues are expected to have weighed on its margin performance in the near term. Nevertheless, LECO’s pricing actions are likely to have somewhat negated this impact on margins.
Acquisitions to augment its capabilities and geographical footprint as well as focus on developing new products and utilization of digital platforms to engage customers are likely to have driven LECO’s top-line performance. Lincoln Electric's product launches in the promising automation solutions market are likely to have aided growth as well.
LECO has an Earnings ESP of +2.71%. It has an expected earnings growth rate of 4.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 30 days.
Lincoln Electric recorded an earnings surprise in the last four reported quarters, with an average beat of 11.6%. The company is set to release earnings on Feb 21, before the opening bell.
NiSource expects to invest $40 billion in the long-term utility infrastructure modernization program. The existing capex plans will further enhance the reliability of natural gas and electric operations, and help the company offer efficient services to NI’s expanding customer base.
NiSource continues to increase its clean power assets. Moreover, nearly 75% of NI’s investment is recovered within 18 months through rate hikes, which provides the necessary funds to carry on infrastructure upgrade projects.
NiSource has an Earnings ESP of +1.03%. It has an expected earnings growth rate of 6.4% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.6% over the past 60 days.
NI recorded earnings surprises in two out the last four reported quarters, with the average beat being 0.3%. The company is set to release earnings on Feb 22, before the opening bell.