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5 High-Flying Stocks Set to Beat on Q4 Earnings Next Week

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The fourth-quarter 2019 earnings releases have been showing steady improvement so far, which has come as a surprise to several economists and financial experts. Below we discuss five high-flying stocks that have popped in the past three months and are poised to beat earnings estimates next week.

Fourth-Quarter Earnings Results Improving Steadily

Fourth-quarter 2019 earnings results have been improving significantly. In fact, overall earnings expectations have rebounded and are in positive territory. As of Feb 19, 411 S&P 500 members reported fourth-quarter earnings results. Total earnings of these companies are up 1.1% from the same period last year on 4.6% higher revenues. Of the total, 73% surpassed EPS estimates while 65.7% outpaced revenue estimates.

Overall, fourth-quarter 2019 earnings for the S&P 500 Index were projected to be up 0.8% year over year on 4.3% higher revenues. This suggests a complete turnaround from earnings decline of 3.2% year over year on 3.5% higher revenues, projected at the beginning of the reporting cycle. (Read More: Q1 Estimates Holding Up Despite Virus Impact)

5 Stocks Set to Surpass Earnings Estimates

We have narrowed down our search to five companies that are poised to release their earnings results next week. Each of these stocks has either a Zacks Rank #1 (Strong Buy) or 2 (Buy) and a positive Earnings ESP. You can see the complete list of today’s Zacks #1 Rank stocks here.

Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are expected to soar after earnings release. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

The chart below shows the price performance of our five picks in the past three months.

 

Tandem Diabetes Care Inc. TNDM designs, develops and commercializes various products for people with insulin-dependent diabetes in the United States. The company has an Earnings ESP of +86.44%.

The company has an expected earnings growth rate of 107.1% for the current year. The Zacks Consensus Estimate for the current year has improved 33.3% over the last 30 days. The trailing four-quarter positive earnings surprise is 66.7%, on average. The Zacks Rank #1 company is set to release earnings results on Feb 24, after the closing bell.

Alarm.com Holdings Inc. ALRM provides cloud-based software platform solutions for smart residential and commercial properties in the United States and internationally. The company has an Earnings ESP of +1.15%. The trailing four-quarter positive earnings surprise is 66.7%, on average. The Zacks Rank #2 company is set to release earnings results on Feb 25, after the closing bell.

Fox Factory Holding Corp. (FOXF - Free Report) designs, engineers, manufactures, and markets ride dynamics products worldwide. The company has an Earnings ESP of +2.70%. Fox Factory Holding has an expected earnings growth rate of 9.7% for the current year. The Zacks Consensus Estimate for the current year has improved 1.4% over the last 30 days. The trailing four-quarter positive earnings surprise is 6.6%, on average. The Zacks Rank #2 company is set to release earnings results on Feb 25, after the closing bell.

Papa John's International Inc. PZZA operates and franchises pizza delivery and carryout restaurants under the Papa John's trademark in the United States and internationally. It operates through four segments: Domestic Company-Owned Restaurants, North America Commissaries, North America Franchising and International Operations. The company has an Earnings ESP of +0.79%.

Papa John's has an expected earnings growth rate of 42% for the current year. The Zacks Consensus Estimate for the current year has improved 0.6% over the last 30 days. The trailing four-quarter positive earnings surprise is 7.9%, on average. The Zacks Rank #2 company is set to release earnings results on Feb 26, before the opening bell.

BMC Stock Holdings Inc. distributes lumber and building materials to new construction, and repair and remodeling contractors in the United States. The company has an Earnings ESP of +7.04%.

BMC Stock Holdings has an expected earnings growth rate of 8.8% for the current year. The Zacks Consensus Estimate for the current year has improved 0.5% over the last 30 days. The trailing four-quarter positive earnings surprise is 29.3%, on average. The Zacks Rank #2 company is set to release earnings results on Feb 27, before the opening bell.

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