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.
Why Investors Need to Take Advantage of These 2 Oils and Energy Stocks Now
Read MoreHide Full Article
Wall Street watches a company's quarterly report closely to understand as much as possible about its recent performance and what to expect going forward. Of course, one figure often stands out among the rest: earnings.
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.
Now that we know how important earnings and earnings surprises are, it's time to show investors how to take advantage of these events to boost their returns by utilizing the Zacks Earnings ESP filter.
The Zacks Earnings ESP, Explained
The Zacks Expected Surprise Prediction, or ESP, works by locking in on the most up-to-date analyst earnings revisions because they can be more accurate than estimates from weeks or even months before the actual release date. The thinking is pretty straightforward: analysts who provide earnings estimates closer to the report are likely to have more 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.
Bringing together a positive earnings ESP alongside a Zacks Rank #3 (Hold) or better has helped stocks report a positive earnings surprise 70% of the time. Furthermore, by using these parameters, investors have seen 28.3% annual returns on average, according to our 10 year backtest.
Stocks with a #3 (Hold) ranking, which is most stocks covered at 60%, are expected to perform in-line with the broader market. But stocks that fall into the #2 (Buy) and #1 (Strong Buy) ranking, 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 Oceaneering International?
Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. Oceaneering International (OII - Free Report) earns a #1 (Strong Buy) right now and its Most Accurate Estimate sits at $0.24 a share, just 27 days from its upcoming earnings release on February 22, 2024.
OII has an Earnings ESP figure of +5.88%, which, as explained above, is calculated by taking the percentage difference between the $0.24 Most Accurate Estimate and the Zacks Consensus Estimate of $0.23. Oceaneering International is one of a large database 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.
OII 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 SolarEdge Technologies (SEDG - Free Report) as well.
SolarEdge Technologies, which is readying to report earnings on February 12, 2024, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently -$1.19 a share, and SEDG is 17 days out from its next earnings report.
The Zacks Consensus Estimate for SolarEdge Technologies is -$1.34, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +11.8%.
Because both stocks hold a positive Earnings ESP, OII and SEDG 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 >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Investors Need to Take Advantage of These 2 Oils and Energy Stocks Now
Wall Street watches a company's quarterly report closely to understand as much as possible about its recent performance and what to expect going forward. Of course, one figure often stands out among the rest: earnings.
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.
Now that we know how important earnings and earnings surprises are, it's time to show investors how to take advantage of these events to boost their returns by utilizing the Zacks Earnings ESP filter.
The Zacks Earnings ESP, Explained
The Zacks Expected Surprise Prediction, or ESP, works by locking in on the most up-to-date analyst earnings revisions because they can be more accurate than estimates from weeks or even months before the actual release date. The thinking is pretty straightforward: analysts who provide earnings estimates closer to the report are likely to have more 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.
Bringing together a positive earnings ESP alongside a Zacks Rank #3 (Hold) or better has helped stocks report a positive earnings surprise 70% of the time. Furthermore, by using these parameters, investors have seen 28.3% annual returns on average, according to our 10 year backtest.
Stocks with a #3 (Hold) ranking, which is most stocks covered at 60%, are expected to perform in-line with the broader market. But stocks that fall into the #2 (Buy) and #1 (Strong Buy) ranking, 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 Oceaneering International?
Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. Oceaneering International (OII - Free Report) earns a #1 (Strong Buy) right now and its Most Accurate Estimate sits at $0.24 a share, just 27 days from its upcoming earnings release on February 22, 2024.
OII has an Earnings ESP figure of +5.88%, which, as explained above, is calculated by taking the percentage difference between the $0.24 Most Accurate Estimate and the Zacks Consensus Estimate of $0.23. Oceaneering International is one of a large database 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.
OII 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 SolarEdge Technologies (SEDG - Free Report) as well.
SolarEdge Technologies, which is readying to report earnings on February 12, 2024, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently -$1.19 a share, and SEDG is 17 days out from its next earnings report.
The Zacks Consensus Estimate for SolarEdge Technologies is -$1.34, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +11.8%.
Because both stocks hold a positive Earnings ESP, OII and SEDG 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 >>