Why Investors Need to Take Advantage of These 2 Finance Stocks Now

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, 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.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 Expected Surprise Prediction, or ESP, works by locking in on the most up-to-date analyst earnings revisions because they can be more accurate than estimates from weeks or even months before the actual release date. The thinking is pretty straightforward: analysts who provide earnings estimates closer to the report are likely to have more 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.In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 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 Progressive?The final step today is to look at a stock that meets our ESP qualifications. Progressive (PGR) earns a #2 (Buy) two days from its next quarterly earnings release on April 18, 2025, and its Most Accurate Estimate comes in at $4.82 a share.Progressive's Earnings ESP sits at +2.01%, which, as explained above, is calculated by taking the percentage difference between the $4.82 Most Accurate Estimate and the Zacks Consensus Estimate of $4.72. PGR is also part of a large group of stocks that boast a positive ESP. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.PGR is just one of a large group of Finance stocks with a positive ESP figure. Arch Capital Group (ACGL) is another qualifying stock you may want to consider.Arch Capital Group is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on April 29, 2025. ACGL's Most Accurate Estimate sits at $1.38 a share 13 days from its next earnings release.For Arch Capital Group, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $1.34 is +2.66%.Because both stocks hold a positive Earnings ESP, PGR and ACGL 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 >>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 The Progressive Corporation (PGR): Free Stock Analysis Report Arch Capital Group Ltd. (ACGL): 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