If you are searching for a stock with an excellent history of beating earnings estimates and is in an excellent place to maintain the pattern in the next quarterly report of its, you should think about Advanced Micro Devices (AMD). This company, which is in the Zacks Electronics – Semiconductors business, shows capability for another earnings beat.
This particular chipmaker has an established history of topping earnings estimates, especially when looking at the previous 2 reports. The company boasts an average surprise in the past 2 quarters of 13.19 %.
For pretty much the most recent quarter, Advanced Micro was likely 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 %.
Price as well as EPS Surprise
Thanks in part to this particular history, there has been a favorable change of earnings estimates for Advanced Micro lately. In truth, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is actually good, which is actually a great sign of an earnings beat, especially when matched with the strong Zacks Rank of its.
Our investigation shows that stocks with the mix of a confident Earnings ESP & a Zacks Rank #3 (Hold) or perhaps better make a positive surprise almost 70 % of the time. Quite simply, if you have ten stocks with this particular blend, the amount of stocks that outdo the consensus estimate is usually as high as seven.
The Zacks Earnings ESP compares 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 the estimates of theirs straightaway before an earnings release contain the latest information, which might potentially be more accurate compared to what they and others contributing to the consensus had predicted earlier.
Advanced Micro has an Earnings ESP of +3.23 % at the second, suggesting that analysts have evolved bullish on its near-term earnings possibilities. Once 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 unfavorable, investors should be aware that this will decrease the predictive power of the metric. But, a negative value just isn’t signs of a stock’s earnings miss.
Many organizations end up beating the consensus EPS estimate, but that may not be the single justification for their stocks moving higher. On the other hand, several stocks may keep their ground even if they end up missing the consensus estimate.
Because of this particular, it is really important to examine a company’s Earnings ESP ahead of its quarterly discharge to raise the likelihood of success. Make sure to utilize our Earnings ESP Filter to uncover the very best stocks to invest in as well as advertise before they’ve reported.