Looking for a inventory that has been constantly beating earnings estimates and is perhaps nicely p
Looking for a inventory that has been constantly beating earnings estimates and is perhaps nicely positioned to maintain the streak alive in its subsequent quarterly report? Lumen Applied sciences LUMN, which belongs to the Zacks Wi-fi Nationwide business, might be an ideal candidate to think about.
This communications firm has seen a pleasant streak of beating earnings estimates, particularly when wanting on the earlier two stories. The common shock for the final two quarters was 30.14%.
For the final reported quarter, Lumen Applied sciences got here out with earnings of $0.40 per share versus the Zacks Consensus Estimate of $0.31 per share, representing a shock of 29.03%. For the earlier quarter, the corporate was anticipated to publish earnings of $0.32 per share and it truly produced earnings of $0.42 per share, delivering a shock of 31.25%.
Worth and EPS Shock
For Lumen Applied sciences, estimates have been trending larger, thanks partially to this earnings shock historical past. And once you take a look at the inventory’s constructive Zacks Earnings ESP (Anticipated Shock Prediction), it is an ideal indicator of a future earnings beat, particularly when mixed with its strong Zacks Rank.
Our analysis exhibits that shares with the mix of a constructive Earnings ESP and a Zacks Rank #3 (Maintain) or higher produce a constructive shock almost 70% of the time. In different phrases, if in case you have 10 shares with this mixture, the variety of shares that beat the consensus estimate might be as excessive as seven.
The Zacks Earnings ESP compares the Most Correct Estimate to the Zacks Consensus Estimate for the quarter; the Most Correct Estimate is a model of the Zacks Consensus whose definition is said to alter. The thought right here is that analysts revising their estimates proper earlier than an earnings launch have the most recent info, which might probably be extra correct than what they and others contributing to the consensus had predicted earlier.
Lumen Applied sciences has an Earnings ESP of +11.11% in the meanwhile, suggesting that analysts have grown bullish on its near-term earnings potential. While you mix this constructive Earnings ESP with the inventory’s Zacks Rank #3 (Maintain), it exhibits that one other beat is presumably across the nook. The corporate’s subsequent earnings report is predicted to be launched on February 10, 2021.
Traders ought to be aware, nonetheless, {that a} unfavorable Earnings ESP studying is just not indicative of an earnings miss, however a unfavorable worth does cut back the predictive energy of this metric.
Many corporations find yourself beating the consensus EPS estimate, however that is probably not the only real foundation for his or her shares shifting larger. Alternatively, some shares could maintain their floor even when they find yourself lacking the consensus estimate.
Due to this, it is actually necessary to examine an organization’s Earnings ESP forward of its quarterly launch to extend the percentages of success. Ensure that to make the most of our Earnings ESP Filter to uncover one of the best shares to purchase or promote earlier than they’ve reported.
(Be aware: We’re reissuing this text to appropriate a mistake. The unique article, issued on January 14, 2021, ought to now not be relied upon.)
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The views and opinions expressed herein are the views and opinions of the creator and don’t essentially mirror these of Nasdaq, Inc.