Chicago, IL – May 2, 2025 – The stocks in this week’s article are Fox FOXA, Universal Technical Institute UTI, Pfizer PFE, Tenet Healthcare THC and Newmont NEM.
Looking for Earnings Beats? Buy These 5 Top-Ranked Stocks
It is not surprising that before an earnings season, every investor looks for stocks that can beat market expectations. This is because investors always try to position themselves ahead of time and look to tap stocks that are high-quality in nature.
In this regard, we ran a screener that yielded stocks Fox, Universal Technical Institute, Pfizer, Tenet Healthcare and Newmont as the likely winners on the earnings beat potential.
Why Is a Positive Earnings Surprise So Important?
Historically, stocks of companies with solid quarterly earnings (on a nominal basis) tank if they miss or merely meet market expectations. After all, a 20% earnings rise (though apparently looks good) doesn’t tell you if earnings growth has been exhibiting a decelerating trend.
Also, seasonal fluctuations come into play sometimes. If a company’s Q1 is seasonally weak and Q4 strong, then it is likely to report a sequential earnings decline. In such cases, growth rates are misleading while judging the true health of a company.
On the other hand, after much brainstorming and analysis of companies’ financials and initiatives, Wall Street analysts project earnings of companies. They in fact club their insights and a company’s guidance when deriving an earnings estimate.
Thus, outperforming that estimate is almost equivalent to beating the company’s own expectation as well as the market perception. And if the margin of earnings surprise is big, it typically drives the stock higher right after the release. Thus, more than anything else, an earnings surprise can push a stock higher.
How to Find Stocks that Can Beat?
Now, finding stocks that have the potential to beat on the bottom line may be investors’ dream but not an easy job. One way to do this is to look at the earnings surprise history of the company.
An impressive track in this regard generally acts as a catalyst in sending a stock higher. It indicates the company’s ability to surpass estimates. And investors generally believe that the company will apply the same secret sauce to execute yet another earning beat in its next release.
Here are five out of 10 stocks:
Fox: The Zacks Rank #1 company is a news, sports and entertainment content provider. You can see the complete list of today’s Zacks #1 Rank stocks here.
The average earnings surprise of FOX for the past four quarters is 24.20%.
Universal Technical Institute: Universal Technical Institute, Inc. provides technical education training in automotive, diesel, collision repair and refinishing, motorcycle, marine and personal watercraft technologies. The UTI stock has a Zacks Rank #2.
The average earnings surprise of UTI for the past four quarters is 39.36%.
Pfizer: The Zacks Rank #2 company’s Biopharma reporting segment includes three broad therapeutic areas, Primary Care (Internal Medicine, Vaccines, Migraine and COVID-19 products), Specialty Care (Inflammation & Immunology, Rare Disease and Hospital [excluding Paxlovid]) and Oncology.
The average earnings surprise of PFE for the past four quarters is 43.49%.
Tenet Healthcare: The Zacks Rank #2 company is an investor-owned healthcare services company, which owns and operates general hospitals and related healthcare facilities for urban and rural communities in numerous states, and has offices in California and Florida.
The average earnings surprise of THC for the past four quarters is 26.39%.
Newmont: Colorado-based Newmont Corporation is one of the world's largest producers of gold with several active mines in Nevada, Peru, Australia and Ghana. The stock has a Zacks Rank #2.
The average earnings surprise of NEM for the past four quarters is 32.41%.
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