Two factors often determine stock prices in the long run: earnings and interest rates. Investors can't control the latter, but they can focus on a company's earnings results every quarter.

The earnings figure itself is key, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb even higher.

2 Stocks to Add to Your Watchlist

The Zacks Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate. The core of the ESP model is comparing the Most Accurate Estimate to the Zacks Consensus Estimate, where the resulting percentage difference between the two equals the Expected Surprise Prediction.

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. Casey's General Stores (CASY) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at $4.30 a share, just 12 days from its upcoming earnings release on December 9, 2024.

Casey's General Stores' Earnings ESP sits at 1.5%, which, as explained above, is calculated by taking the percentage difference between the $4.30 Most Accurate Estimate and the Zacks Consensus Estimate of $4.24.

CASY is just one of a large group of Retail-Wholesale stocks with a positive ESP figure. Lowe's (LOW) is another qualifying stock you may want to consider.

Lowe's, which is readying to report earnings on February 25, 2025, sits at a Zacks Rank #3 (Hold) right now. It's Most Accurate Estimate is currently $1.82 a share, and LOW is 90 days out from its next earnings report.

For Lowe's, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $1.81 is 0.39%.

CASY and LOW's positive ESP metrics may signal that a positive earnings surprise for both stocks is on the horizon.

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 >>

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Casey's General Stores, Inc. (CASY) : Free Stock Analysis Report

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