In This Article:
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, 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 even higher.
2 Stocks to Add to Your Watchlist
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. 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.
The final step today is to look at a stock that meets our ESP qualifications. Global Ship Lease (GSL) earns a Zacks Rank #3 11 days from its next quarterly earnings release on March 3, 2025, and its Most Accurate Estimate comes in at $2.34 a share.
Global Ship Lease's Earnings ESP sits at 1.96%, which, as explained above, is calculated by taking the percentage difference between the $2.34 Most Accurate Estimate and the Zacks Consensus Estimate of $2.30.
GSL is just one of a large group of Transportation stocks with a positive ESP figure. C.H. Robinson Worldwide (CHRW) is another qualifying stock you may want to consider.
C.H. Robinson Worldwide is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on May 7, 2025. CHRW's Most Accurate Estimate sits at $1.10 a share 76 days from its next earnings release.
For C.H. Robinson Worldwide, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $1.06 is 3.44%.
Because both stocks hold a positive Earnings ESP, GSL and CHRW could potentially post earnings beats in their next reports.
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 >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report