These 2 Consumer Discretionary Stocks Could Beat Earnings: Why They Should Be on Your Radar

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.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 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.With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the ESP figure. The system also utilizes our core Zacks Rank to provide a stronger system for identifying stocks that might beat their next quarterly earnings estimate and possibly see the stock price climb.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.Stocks with a ranking of #3 (Hold), or 60% of all stocks covered by the Zacks Rank, are expected to perform in-line with the broader market. Stocks with rankings of #2 (Buy) and #1 (Strong Buy), or the top 15% and top 5% of stocks, respectively, should outperform the market; Strong Buy stocks should outperform more than any other rank.Should You Consider BJ's Wholesale Club?The final step today is to look at a stock that meets our ESP qualifications. BJ's Wholesale Club (BJ) earns a #3 (Hold) 24 days from its next quarterly earnings release on March 6, 2025, and its Most Accurate Estimate comes in at $0.89 a share.By taking the percentage difference between the $0.89 Most Accurate Estimate and the $0.86 Zacks Consensus Estimate, BJ's Wholesale Club has an Earnings ESP of +3.16%. Investors should also know that BJ is one of a large group 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.BJ is one of just a large database of Consumer Discretionary stocks with positive ESPs. Another solid-looking stock is Live Nation (LYV).Live Nation, which is readying to report earnings on February 20, 2025, sits at a Zacks Rank #2 (Buy) right now. It's Most Accurate Estimate is currently -$1.09 a share, and LYV is 10 days out from its next earnings report.The Zacks Consensus Estimate for Live Nation is -$1.19, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +8.49%.BJ and LYV'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 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 >>Should You Invest in BJ's Wholesale Club Holdings, Inc. (BJ)?Before you invest in BJ's Wholesale Club Holdings, Inc. (BJ), want to know the best stocks to buy for the next 30 days? Check out Zacks Investment Research for our free report on the 7 best stocks to buy.Zacks Investment Research has been committed to providing investors with tools and independent research since 1978. For more than a quarter century, the Zacks Rank stock-rating system has more than doubled the S&P 500 with an average gain of +24.08% per year. (These returns cover a period from January 1, 1988 through May 6, 2024.)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 BJ's Wholesale Club Holdings, Inc. (BJ): Free Stock Analysis Report Live Nation Entertainment, Inc. (LYV): 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