In case you are looking for a stock which has an excellent history of beating earnings estimates and it is in an excellent position to maintain the trend in its next quarterly report, you need to think about Advanced Micro Devices (AMD). This business, which happens to be 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 preceding two reports. The company boasts an average surprise for the past two quarters of 13.19 %.
For essentially the most recent quarter, Advanced Micro was expected to publish 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 really produced $0.18 per share, a surprise of 12.50 %.
Price and EPS Surprise
Thanks in part to this past, there has been a favorable change in earnings estimates for Advanced Micro lately. In reality, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is actually good, which is actually a great warning of an earnings beat, mainly when matched with the strong Zacks Rank of its.
The investigation of ours shows that stocks with the blend of a confident Earnings ESP & a Zacks Rank #3 (Hold) or even better deliver a positive surprise almost 70 % of the time. In other words, if you’ve ten stocks with this particular blend, the amount of stocks that beat the consensus estimate is usually as high as seven.
The Zacks Earnings ESP compares probably the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose description is actually connected to change. The thought here’s that analysts revising their estimates directly before an earnings release have the most recent information, which might likely be a little more accurate compared to what they and others bringing about the consensus had predicted previously.
Advanced Micro has an Earnings ESP of +3.23 % at the second, suggesting that analysts have developed bullish on its near term earnings potential. When you incorporate this positive Earnings ESP with the stock’s Zacks Rank #3 (Hold), it shows that another beat is possibly around the corner.
If ever the Earnings ESP comes up negative, investors should note that this will decrease the predictive power of the metric. But, a bad value is not indicative of a stock’s earnings miss.
Many companies wind up beating the consensus EPS appraisal, but that is quite possibly not the lone justification for their stocks moving higher. On the other hand, some stocks could keep their ground even if 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 release to raise the chances of success. Ensure that you utilize our Earnings ESP Filter to uncover the most effective stocks to invest in or possibly sell before they’ve reported.