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These 2 Oils and Energy Stocks Could Beat Earnings: Why They Should Be on Your Radar
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Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.
We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.
The ability to identify stocks that are likely to top quarterly earnings expectations can be profitable, but it's no simple task. Here at Zacks, our Earnings ESP filter helps make things easier.
The Zacks Earnings ESP, Explained
The Zacks Earnings ESP is more formally known as the Expected Surprise Prediction, and it aims to grab the inside track on the latest analyst estimate revisions ahead of a company's report. The idea is relatively intuitive as a newer projection might be based on more complete information.
Now that we understand the basic idea, let's look at how the Expected Surprise Prediction works. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.
In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.
Stocks with a ranking of #3 (Hold), or 60% of all stocks covered by the Zacks Rank, are expected to perform in-line with the broader market. Stocks with rankings of #2 (Buy) and #1 (Strong Buy), or the top 15% and top 5% of stocks, respectively, should outperform the market; Strong Buy stocks should outperform more than any other rank.
Should You Consider Sunrun?
The final step today is to look at a stock that meets our ESP qualifications. Sunrun (RUN - Free Report) earns a #1 (Strong Buy) 23 days from its next quarterly earnings release on November 1, 2023, and its Most Accurate Estimate comes in at $1.04 a share.
By taking the percentage difference between the $1.04 Most Accurate Estimate and the -$0.05 Zacks Consensus Estimate, Sunrun has an Earnings ESP of +2193.31%. Investors should also know that RUN is one of a large group of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
RUN is part of a big group of Oils and Energy stocks that boast a positive ESP, and investors may want to take a look at Exxon Mobil (XOM - Free Report) as well.
Slated to report earnings on October 27, 2023, Exxon Mobil holds a #2 (Buy) ranking on the Zacks Rank, and it's Most Accurate Estimate is $2.38 a share 18 days from its next quarterly update.
For Exxon Mobil, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $2.26 is +5.08%.
Because both stocks hold a positive Earnings ESP, RUN and XOM could potentially post earnings beats in their next reports.
Find Stocks to Buy or Sell Before They're Reported
Use the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>
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These 2 Oils and Energy Stocks Could Beat Earnings: Why They Should Be on Your Radar
Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.
We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.
The ability to identify stocks that are likely to top quarterly earnings expectations can be profitable, but it's no simple task. Here at Zacks, our Earnings ESP filter helps make things easier.
The Zacks Earnings ESP, Explained
The Zacks Earnings ESP is more formally known as the Expected Surprise Prediction, and it aims to grab the inside track on the latest analyst estimate revisions ahead of a company's report. The idea is relatively intuitive as a newer projection might be based on more complete information.
Now that we understand the basic idea, let's look at how the Expected Surprise Prediction works. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.
In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.
Stocks with a ranking of #3 (Hold), or 60% of all stocks covered by the Zacks Rank, are expected to perform in-line with the broader market. Stocks with rankings of #2 (Buy) and #1 (Strong Buy), or the top 15% and top 5% of stocks, respectively, should outperform the market; Strong Buy stocks should outperform more than any other rank.
Should You Consider Sunrun?
The final step today is to look at a stock that meets our ESP qualifications. Sunrun (RUN - Free Report) earns a #1 (Strong Buy) 23 days from its next quarterly earnings release on November 1, 2023, and its Most Accurate Estimate comes in at $1.04 a share.
By taking the percentage difference between the $1.04 Most Accurate Estimate and the -$0.05 Zacks Consensus Estimate, Sunrun has an Earnings ESP of +2193.31%. Investors should also know that RUN is one of a large group of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
RUN is part of a big group of Oils and Energy stocks that boast a positive ESP, and investors may want to take a look at Exxon Mobil (XOM - Free Report) as well.
Slated to report earnings on October 27, 2023, Exxon Mobil holds a #2 (Buy) ranking on the Zacks Rank, and it's Most Accurate Estimate is $2.38 a share 18 days from its next quarterly update.
For Exxon Mobil, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $2.26 is +5.08%.
Because both stocks hold a positive Earnings ESP, RUN and XOM could potentially post earnings beats in their next reports.
Find Stocks to Buy or Sell Before They're Reported
Use the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>