Wall Street watches a company's quarterly report closely to understand as much as possible about its recent performance and what to expect going forward. Of course, one figure often stands out among the rest: earnings.

We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.

2 Stocks to Add to Your Watchlist

The Zacks Earnings ESP is more formally known as the Expected Surprise Prediction, and it aims to grab the inside track on the latest analyst estimate revisions ahead of a company's report. The idea is relatively intuitive as a newer projection might be based on more complete information. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.

Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. FuelCell Energy (FCEL) earns a Zacks Rank #2 right now and its Most Accurate Estimate sits at -$1.50 a share, just 29 days from its upcoming earnings release on December 17, 2024.

By taking the percentage difference between the -$1.50 Most Accurate Estimate and the -$1.80 Zacks Consensus Estimate, FuelCell Energy has an Earnings ESP of 16.67%.

FCEL is just one of a large group of Oils-Energy stocks with a positive ESP figure. Baker Hughes (BKR) is another qualifying stock you may want to consider.

Baker Hughes, which is readying to report earnings on January 28, 2025, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently $0.63 a share, and BKR is 71 days out from its next earnings report.

For Baker Hughes, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.63 is 0.13%.

Because both stocks hold a positive Earnings ESP, FCEL and BKR could potentially post earnings beats in their next reports.

Find Stocks to Buy or Sell Before They're Reported

Use the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

FuelCell Energy, Inc. (FCEL) : Free Stock Analysis Report

Baker Hughes Company (BKR) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research