In case you are searching for a stock that has an excellent history of beating earnings estimates and is in an excellent position to maintain the trend in the next quarterly report of its, you need to consider Advanced Micro Devices (AMD). This company, and that is in the Zacks Electronics – Semiconductors industry, shows potential for another earnings beat.
This particular chipmaker has an established record of topping earnings estimates, particularly when looking at the earlier two reports. The company boasts an average surprise in the past 2 quarters of 13.19 %.
For probably the most recent quarter, Advanced Micro was anticipated to post earnings of $0.36 per share, but it reported $0.41 per share rather, representing a surprise of 13.89 %. For the earlier quarter, the consensus estimate was $0.16 per AMD share, while it really produced $0.18 per share, a surprise of 12.50 %.
Cost and EPS Surprise
Thanks in part to this particular history, there continues to be a favorable change in earnings estimates for Advanced Micro lately. In reality, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is positive, which is an excellent indicator of an earnings beat, especially when matched with its strong Zacks Rank.
Our investigation shows that stocks with the blend of a confident Earnings ESP & a Zacks Rank #3 (Hold) or even much better produce a positive surprise about 70 % of the moment. Put simply, if you have ten stocks with this particular blend, the amount of stocks that match the consensus estimate might be as high as seven.
The Zacks Earnings ESP compares probably the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; probably the Most Accurate Estimate is a version of the Zacks Consensus whose definition is actually related to change. The thought here is that analysts revising their estimates straightaway before an earnings release have the most recent info, which might likely be more accurate than what they and others bringing about the consensus had predicted previously.
Advanced Micro has an Earnings ESP of +3.23 % at the second, hinting that analysts have developed bullish on the near term earnings potential of its. As soon as you combine this positive Earnings ESP with the stock’s Zacks Rank #3 (Hold), it shows that another beat is perhaps nearby.
When the Earnings ESP comes up negative, investors must be aware that this will lower the predictive power of the metric. However, a bad value is not signs of a stock’s earnings miss.
Many companies end up beating the consensus EPS estimate, but that might not be the sole foundation for their stocks moving higher. On the other hand, several stocks may keep their ground even in case they end up missing the consensus estimate.
Because of this, it is really important to look at a company’s Earnings ESP ahead of its quarterly discharge to increase the likelihood of success. You’ll want to use our Earnings ESP Filter to uncover the very best stocks to purchase as well as sell before they have reported.