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Why Investors Need to Take Advantage of These 2 Computer and Technology Stocks Now
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Two factors often determine stock prices in the long run: earnings and interest rates. Investors can't control the latter, but they can focus on a company's earnings results every quarter.
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.
Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.
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.
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 Seagate?
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. Seagate (STX - Free Report) earns a #3 (Hold) right now and its Most Accurate Estimate sits at $2.52 a share, just eight days from its upcoming earnings release on July 29, 2025.
By taking the percentage difference between the $2.52 Most Accurate Estimate and the $2.46 Zacks Consensus Estimate, Seagate has an Earnings ESP of +2.34%. Investors should also know that STX 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.
STX is one of just a large database of Computer and Technology stocks with positive ESPs. Another solid-looking stock is Datadog (DDOG - Free Report) .
Slated to report earnings on August 7, 2025, Datadog holds a #3 (Hold) ranking on the Zacks Rank, and its Most Accurate Estimate is $0.42 a share 17 days from its next quarterly update.
Datadog's Earnings ESP figure currently stands at +2.83% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.41.
STX and DDOG's positive ESP metrics may signal that a positive earnings surprise for both stocks is on the horizon.
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 Computer and Technology Stocks Now
Two factors often determine stock prices in the long run: earnings and interest rates. Investors can't control the latter, but they can focus on a company's earnings results every quarter.
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.
Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.
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.
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 Seagate?
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. Seagate (STX - Free Report) earns a #3 (Hold) right now and its Most Accurate Estimate sits at $2.52 a share, just eight days from its upcoming earnings release on July 29, 2025.
By taking the percentage difference between the $2.52 Most Accurate Estimate and the $2.46 Zacks Consensus Estimate, Seagate has an Earnings ESP of +2.34%. Investors should also know that STX 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.
STX is one of just a large database of Computer and Technology stocks with positive ESPs. Another solid-looking stock is Datadog (DDOG - Free Report) .
Slated to report earnings on August 7, 2025, Datadog holds a #3 (Hold) ranking on the Zacks Rank, and its Most Accurate Estimate is $0.42 a share 17 days from its next quarterly update.
Datadog's Earnings ESP figure currently stands at +2.83% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.41.
STX and DDOG's positive ESP metrics may signal that a positive earnings surprise for both stocks is on the horizon.
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 >>