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.

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 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 Morgan Stanley?

The final step today is to look at a stock that meets our ESP qualifications. Morgan Stanley (MS Quick QuoteMS - Free Report) earns a #2 (Buy) nine days from its next quarterly earnings release on January 15, 2026, and its Most Accurate Estimate comes in at $2.38 a share.

MS has an Earnings ESP figure of +2.71%, which, as explained above, is calculated by taking the percentage difference between the $2.38 Most Accurate Estimate and the Zacks Consensus Estimate of $2.32. Morgan Stanley 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.

MS is one of just a large database of Finance stocks with positive ESPs. Another solid-looking stock is Skyward Specialty Insurance (SKWD Quick QuoteSKWD - Free Report) .

Skyward Specialty Insurance, which is readying to report earnings on February 24, 2026, sits at a Zacks Rank #1 (Strong Buy) right now. Its Most Accurate Estimate is currently $0.96 a share, and SKWD is 49 days out from its next earnings report.

The Zacks Consensus Estimate for Skyward Specialty Insurance is $0.93, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +3.23%.

MS and SKWD'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 >>