If you are looking for a stock that has an excellent history of beating earnings estimates and is in a great position to sustain the movement in its next quarterly report, you need to think about Advanced Micro Devices (AMD). This business, which is in the Zacks Electronics – Semiconductors business, shows capability for another earnings beat.
This chipmaker has an established history of topping earnings estimates, particularly when looking at the prior 2 reports. The company boasts an average surprise for the past two quarters of 13.19 %.
For the most recent quarter, Advanced Micro was likely to post 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 estimation 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 history, there continues to be a favorable change of earnings estimates for Advanced Micro lately. In truth, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is good, which is actually a good warning of an earnings beat, particularly when coupled with its strong Zacks Rank.
Our investigation shows that stocks with the mix of an optimistic Earnings ESP and a Zacks Rank #3 (Hold) or much better make a good surprise almost 70 % of the moment. Quite simply, if you’ve 10 stocks with this combination, the number of stocks that beat 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; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is associated to change. The concept here’s that analysts revising the estimates of theirs right before an earnings release have the most up info, which may likely be more precise compared to what they and some bringing about the consensus had predicted previously.
Advanced Micro has an Earnings ESP of +3.23 % at the moment, hinting that analysts have evolved bullish on the near term earnings potential of its. Once you combine this good Earnings ESP with the stock’s Zacks Rank #3 (Hold), it shows that another beat is probably around the corner.
When the Earnings ESP comes up unfavorable, investors must be aware this will lower the predictive power of the metric. But, a negative value is not signs of a stock’s earnings miss.
Many organizations 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 might keep the ground of theirs even if they wind up missing the consensus estimate.
Because of this, it is really vital that you examine a company’s Earnings ESP ahead of its quarterly discharge to increase the likelihood of success. You’ll want to utilize our Earnings ESP Filter to uncover the best stocks to invest in or even sell before they’ve reported.