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.
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. BlackRock (BLK) earns a Zacks Rank #3 28 days from its next quarterly earnings release on July 21, 2025, and its Most Accurate Estimate comes in at $11.16 a share.
By taking the percentage difference between the $11.16 Most Accurate Estimate and the $10.41 Zacks Consensus Estimate, BlackRock has an Earnings ESP of 7.25%.
BLK is one of just a large database of Finance stocks with positive ESPs. Another solid-looking stock is Travelers (TRV).
Slated to report earnings on July 17, 2025, Travelers holds a #2 (Buy) ranking on the Zacks Rank, and it’s Most Accurate Estimate is $4.23 a share 24 days from its next quarterly update.
For Travelers, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $3.52 is 20.17%.
BLK and TRV’s positive ESP figures tell us that both stocks have a good chance at beating analyst expectations in their next earnings report.
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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BlackRock (BLK) : Free Stock Analysis Report
The Travelers Companies, Inc. (TRV) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
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