These 2 Retail and Wholesale Stocks Could Beat Earnings: Why They Should Be on Your Radar

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.The earnings figure itself is key, of course, 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 and vice versa.Now that we know how important earnings and earnings surprises are, it's time to show investors how to take advantage of these events to boost their returns by utilizing the Zacks Earnings ESP filter.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.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.When we join a positive earnings ESP with a Zacks Rank #3 (Hold) or stronger, stocks posted a positive bottom-line surprise 70% of the time. Plus, this system saw investors produce roughly 28% 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 Walgreens Boots Alliance?The final step today is to look at a stock that meets our ESP qualifications. Walgreens Boots Alliance (WBA) earns a #2 (Buy) one day from its next quarterly earnings release on March 27, 2025, and its Most Accurate Estimate comes in at $0.58 a share.WBA has an Earnings ESP figure of +9.39%, which, as explained above, is calculated by taking the percentage difference between the $0.58 Most Accurate Estimate and the Zacks Consensus Estimate of $0.53. Walgreens Boots Alliance 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.WBA is just one of a large group of Retail and Wholesale stocks with a positive ESP figure. Sprouts Farmers (SFM) is another qualifying stock you may want to consider.Sprouts Farmers is a Zacks Rank #2 (Buy) stock, and is getting ready to report earnings on May 7, 2025. SFM's Most Accurate Estimate sits at $1.54 a share 42 days from its next earnings release.The Zacks Consensus Estimate for Sprouts Farmers is $1.53, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +0.22%.WBA and SFM'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 Walgreens Boots Alliance, Inc. (WBA)?Before you invest in Walgreens Boots Alliance, Inc. (WBA), 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 Walgreens Boots Alliance, Inc. (WBA): Free Stock Analysis Report Sprouts Farmers Market, Inc. (SFM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks