Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.

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.

2 Stocks to Add to Your Watchlist

The 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. 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.

Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. Walt Disney (DIS) earns a Zacks Rank #3 right now and its Most Accurate Estimate sits at $1.12 a share, just 10 days from its upcoming earnings release on November 14, 2024.

Walt Disney's Earnings ESP sits at 2.09%, which, as explained above, is calculated by taking the percentage difference between the $1.12 Most Accurate Estimate and the Zacks Consensus Estimate of $1.09.

DIS is part of a big group of Consumer Discretionary stocks that boast a positive ESP, and investors may want to take a look at Comcast (CMCSA) as well.

Slated to report earnings on January 23, 2025, Comcast holds a #3 (Hold) ranking on the Zacks Rank, and it's Most Accurate Estimate is $0.93 a share 80 days from its next quarterly update.

For Comcast, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.92 is 1.26%.

DIS and CMCSA's positive ESP figures tell us that both stocks have a good chance at beating analyst expectations in their next earnings report.

Find Stocks to Buy or Sell Before They're Reported

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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