In case you are searching for a stock which has an excellent history of beating earnings estimates and it is in a great place to manage the movement in the next quarterly report of its, you should think about Advanced Micro Devices (AMD). This business, and that is in the Zacks Electronics – Semiconductors business, shows potential for another earnings beat.
This chipmaker has an established record of topping earnings estimates, especially when looking at the prior two reports. The company boasts an average surprise in the past 2 quarters of 13.19 %.
For likely the most recent quarter, Advanced Micro was expected to submit earnings of $0.36 per share, but it reported $0.41 per share instead, representing a surprise of 13.89 %. For the prior quarter, the consensus estimate was $0.16 per AMD share, while it actually produced $0.18 per share, a surprise of 12.50 %.
Cost and EPS Surprise
Thanks in part to this past, 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 good, which is actually an excellent sign of an earnings beat, particularly when matched with its strong Zacks Rank.
Our investigation shows that stocks with the blend of an optimistic Earnings ESP & a Zacks Rank #3 (Hold) or much better produce a positive surprise about seventy % of the time. Quite simply, in case you have ten stocks with this blend, the amount of stocks that match the consensus estimate might be as high as 7.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; probably the Most Accurate Estimate is actually a version of the Zacks Consensus whose definition is connected to change. The thought here is that analysts revising the estimates of theirs right before an earnings release have the most up info, which may potentially be more precise compared to what they and others contributing to the consensus had predicted previously.
Advanced Micro has an Earnings ESP of +3.23 % at the second, hinting that analysts have developed bullish on its near term earnings potential. Once you combine this good Earnings ESP with the stock’s Zacks Rank #3 (Hold), it shows that another beat is probably nearby.
When the Earnings ESP comes up negative, investors must note this will lower the predictive power of the metric. However, a bad value just isn’t signs of a stock’s earnings miss.
Many businesses wind up beating the consensus EPS appraisal, but that might not be the main justification for their stocks moving higher. On the other hand, some stocks could hold the ground of theirs even if they end up missing the consensus estimate.
Because of this, it’s truly important to check a company’s Earnings ESP in front of its quarterly release to increase the chances of success. Ensure that you use our Earnings ESP Filter to uncover the best stocks to purchase or sell before they have reported.