Earnings are arguably the most important single number on a company's quarterly financial report. Wall Street clearly dives into all of the other metrics and management's input, but the EPS figure helps cut through all the noise.

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, 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.

The final step today is to look at a stock that meets our ESP qualifications. Marvell Technology (MRVL) earns a Zacks Rank #2 nine days from its next quarterly earnings release on March 5, 2025, and its Most Accurate Estimate comes in at $0.61 a share.

Marvell Technology's Earnings ESP sits at 2.77%, which, as explained above, is calculated by taking the percentage difference between the $0.61 Most Accurate Estimate and the Zacks Consensus Estimate of $0.59.

MRVL is part of a big group of Computer and Technology stocks that boast a positive ESP, and investors may want to take a look at Applied Materials (AMAT) as well.

Slated to report earnings on May 15, 2025, Applied Materials holds a #3 (Hold) ranking on the Zacks Rank, and it's Most Accurate Estimate is $2.30 a share 80 days from its next quarterly update.

Applied Materials' Earnings ESP figure currently stands at 0.05% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $2.30.

Because both stocks hold a positive Earnings ESP, MRVL and AMAT 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 >>

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Marvell Technology, Inc. (MRVL) : Free Stock Analysis Report

Applied Materials, Inc. (AMAT) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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