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Why Investors Need to Take Advantage of These 2 Retail and Wholesale Stocks Now
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Earnings are arguably the most important single number on a company's quarterly financial report. Wall Street clearly dives into all of the other metrics and management's input, but the EPS figure helps cut through all the noise.
The earnings figure itself is key, of course, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb and vice versa.
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 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.
With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the ESP figure. The system also utilizes our core Zacks Rank to provide a stronger system for identifying stocks that might beat their next quarterly earnings estimate and possibly see the stock price climb.
When we join a positive earnings ESP with a Zacks Rank #3 (Hold) or stronger, stocks posted a positive bottom-line surprise 70% of the time. Plus, this system saw investors produce roughly 28% annual returns on average, according to our 10 year backtest.
Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.
Should You Consider Casey's General Stores?
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. Casey's General Stores (CASY - Free Report) earns a #2 (Buy) right now and its Most Accurate Estimate sits at $2.25 a share, just four days from its upcoming earnings release on March 11, 2024.
By taking the percentage difference between the $2.25 Most Accurate Estimate and the $2.20 Zacks Consensus Estimate, Casey's General Stores has an Earnings ESP of +2.39%. Investors should also know that CASY 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.
CASY is part of a big group of Retail and Wholesale stocks that boast a positive ESP, and investors may want to take a look at Abercrombie & Fitch (ANF - Free Report) as well.
Abercrombie & Fitch, which is readying to report earnings on May 22, 2024, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently $0.62 a share, and ANF is 76 days out from its next earnings report.
Abercrombie & Fitch's Earnings ESP figure currently stands at +2.76% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.60.
CASY and ANF's positive ESP figures tell us that both stocks have a good chance at beating analyst expectations in their next earnings report.
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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Why Investors Need to Take Advantage of These 2 Retail and Wholesale Stocks Now
Earnings are arguably the most important single number on a company's quarterly financial report. Wall Street clearly dives into all of the other metrics and management's input, but the EPS figure helps cut through all the noise.
The earnings figure itself is key, of course, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb and vice versa.
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 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.
With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the ESP figure. The system also utilizes our core Zacks Rank to provide a stronger system for identifying stocks that might beat their next quarterly earnings estimate and possibly see the stock price climb.
When we join a positive earnings ESP with a Zacks Rank #3 (Hold) or stronger, stocks posted a positive bottom-line surprise 70% of the time. Plus, this system saw investors produce roughly 28% annual returns on average, according to our 10 year backtest.
Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.
Should You Consider Casey's General Stores?
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. Casey's General Stores (CASY - Free Report) earns a #2 (Buy) right now and its Most Accurate Estimate sits at $2.25 a share, just four days from its upcoming earnings release on March 11, 2024.
By taking the percentage difference between the $2.25 Most Accurate Estimate and the $2.20 Zacks Consensus Estimate, Casey's General Stores has an Earnings ESP of +2.39%. Investors should also know that CASY 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.
CASY is part of a big group of Retail and Wholesale stocks that boast a positive ESP, and investors may want to take a look at Abercrombie & Fitch (ANF - Free Report) as well.
Abercrombie & Fitch, which is readying to report earnings on May 22, 2024, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently $0.62 a share, and ANF is 76 days out from its next earnings report.
Abercrombie & Fitch's Earnings ESP figure currently stands at +2.76% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.60.
CASY and ANF's positive ESP figures tell us that both stocks have a good chance at beating analyst expectations in their next earnings report.
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 >>