Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.

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.

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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.

The final step today is to look at a stock that meets our ESP qualifications. Clorox (CLX) earns a Zacks Rank #2 five days from its next quarterly earnings release on October 30, 2024, and its Most Accurate Estimate comes in at $1.40 a share.

By taking the percentage difference between the $1.40 Most Accurate Estimate and the $1.36 Zacks Consensus Estimate, Clorox has an Earnings ESP of 2.6%.

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The Clorox Company (CLX) : Free Stock Analysis Report

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