If you’re looking for stocks that have a solid track record of exceeding expectations and are well-positioned to stay trendy in your next quarterly report, look no further than Bristol-Myers Squibb (BMY – free report). Zacks Medical – This company in the Biomedical and Genetics industry presents another earning potential.
The biopharmaceutical company has significantly exceeded its earnings estimates, especially in the previous two reports. The average surprise rate over the past two quarters was 8.28%.
For its last reported quarter, Bristol-Myers posted earnings of $1.99 per share. By contrast, it represents a surprise of 8.74% against the Zachs consensus estimate of $1.83 per share. In the last quarter, the company was expected to post earnings of $1.79 per share for him, but he actually made earnings of $1.93 per share, a surprise 7.82%.
Price and EPS Surprise
With this earnings history in mind, recent estimates for Bristol-Myers are up. In fact, the company’s Zacks Earnings ESP (Expected Surprise Prediction) is positive, indicating improved earnings, especially when this metric is combined with the excellent Zacks Rank.
According to our research, stocks with a combination of positive Earnings ESP and Zacks Rank 3 (Hold) or higher deliver a positive surprise almost 70% of the time. In other words, if there are 10 stocks in this combination, there could be as many as 7 stocks above the consensus estimate.
Zacks Earnings ESP compares the most accurate estimate to the quarterly Zacks Consensus estimate. The Most Accurate Estimate is a version of the Zacks Consensus, whose definitions are subject to change. The idea here is that analysts who revise their estimates just before the earnings release have the most up-to-date information. This may be more accurate than previously predicted by analysts and others contributing to the consensus.
Bristol-Myers currently has a earnings ESP of +5.83%, suggesting analysts are bullish about its near-term earnings potential. Combine this positive earnings ESP with a Zacks ranked #3 (hold) and you know another beat could be just around the corner. The company’s next earnings report is expected to be released on February 2, 2023.
It is important to note that in the Earnings ESP metric, negative values decrease predictive power. However, a negative Earnings ESP does not indicate Earnings Miss.
Many companies ended up beating consensus EPS estimates, but that may not be the only reason stocks are rising. On the other hand, some stocks may retain their position even if they ultimately miss the consensus estimate.
For this reason, it is very important to review your company’s revenue ESP prior to each quarterly release to increase your chances of success. Use the Earnings ESP Filter to find the best stocks to buy or sell before they’re reported.
