The major part of the Q3 earnings season is over, with 364 S&P 500 members (as of Nov 2) – accounting for 72.6% of the index’s total market capitalization – having already reported results, according to the latest Earnings Outlook.
Total earnings for these index members were up 1.6% from the year-ago quarter and revenues were up 1.6% year over year. The beat ratio was 72.3% for earnings and 54.7% for revenues.
Notably, the ongoing reporting cycle is on track to be the first quarter of positive earnings growth after five consecutive quarters of earnings decline for the S&P 500 index. However, though the third-quarter reporting cycle saw numerous positive surprises and stability in current-quarter (Q4 2016) estimates in the beginning, these two attributes have started losing ground this week. Positive surprises, particularly on the revenue side, have become harder to come by and Q4 estimates are moving down.
Total fourth-quarter earnings for the S&P 500 index are currently expected to be up 4.1% from the same period last year, down from 4.9% last week and 5.2% in early October. However, Technology and Finance, the two largest sectors in the S&P 500 index, have held up nicely.
Among the technology firms slated to report their earnings results on Nov 7, let’s see what lies ahead for these four IT services stocks:
Fair Isaac Corporation (FICO - Free Report) , an analytics software firm, will report fourth-quarter fiscal 2016 results. The stock carries a Zacks Rank #3 (Hold), which increases the predictive power of ESP. Yet, we cannot predict an earnings beat as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 74 cents, resulting in an Earnings ESP of 0.0%. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
Notably, Fair Isaac Corporationsurpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average positive surprise of 36.96%.
Acxiom Corporation (ACXM - Free Report) , the data foundation for the world’s best marketers, will report second-quarter fiscal 2017 results. The stock carries a Zacks Rank #3 and has an Earnings ESP of 0.00%. Therefore it is unlikely to beat earnings estimates this quarter.
We also note that Acxiom Corporation surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average positive surprise of 102.50%.
EPAM Systems, Inc. (EPAM - Free Report) , a leading global provider of product development and software engineering solutions, will report third-quarter 2016 results. The stock has an Earnings ESP of 0.00% which surprise prediction difficult although it carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We also note that EPAM Systems surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average positive surprise of 3.53%.
EarthLink Holdings Corp. (ELNK - Free Report) will report third-quarter 2016 results. The firm is also unlikely to beat earnings estimates as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 1 cent, resulting in an Earnings ESP of 0.00%. The stock carries a Zacks Rank #3.
Price and EPS surprise chart
Stay tuned! Check back on our full write-up on earnings releases of these stocks.
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