These 2 Computer and Technology Stocks Could Beat Earnings: Why They Should Be on Your Radar

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.The ability to identify stocks that are likely to top quarterly earnings expectations can be profitable, but it's no simple task. Here at Zacks, our Earnings ESP filter helps make things easier.The Zacks Earnings ESP, ExplainedThe 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.Now that we understand the basic idea, let's look at how the Expected Surprise Prediction works. 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.Bringing together a positive earnings ESP alongside a Zacks Rank #3 (Hold) or better has helped stocks report a positive earnings surprise 70% of the time. Furthermore, by using these parameters, investors have seen 28.3% annual returns on average, according to our 10 year backtest.Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.Should You Consider Paypal?The final step today is to look at a stock that meets our ESP qualifications. Paypal (PYPL) earns a #3 (Hold) 12 days from its next quarterly earnings release on February 4, 2025, and its Most Accurate Estimate comes in at $1.14 a share.PYPL has an Earnings ESP figure of +2.41%, which, as explained above, is calculated by taking the percentage difference between the $1.14 Most Accurate Estimate and the Zacks Consensus Estimate of $1.11. Paypal is one of a large database of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.PYPL is just one of a large group of Computer and Technology stocks with a positive ESP figure. Impinj (PI) is another qualifying stock you may want to consider.Slated to report earnings on February 5, 2025, Impinj holds a #1 (Strong Buy) ranking on the Zacks Rank, and it's Most Accurate Estimate is $0.48 a share 13 days from its next quarterly update.Impinj's Earnings ESP figure currently stands at +1.41% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.47.Because both stocks hold a positive Earnings ESP, PYPL and PI could potentially post earnings beats in their next reports.Find Stocks to Buy or Sell Before They're ReportedUse 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 >>7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.1% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>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 PayPal Holdings, Inc. (PYPL): Free Stock Analysis Report Impinj, Inc. (PI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks