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.

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.

The last thing we will do today, now that we have a grasp on the ESP and how powerful of a tool it can be, is to look at a qualifying stock. Crescent Energy (CRGY) holds a Zacks Rank #3 at the moment and its Most Accurate Estimate comes in at $0.39 a share 14 days away from its upcoming earnings release on November 4, 2024.

CRGY has an Earnings ESP figure of 6.12%, which, as explained above, is calculated by taking the percentage difference between the $0.39 Most Accurate Estimate and the Zacks Consensus Estimate of $0.37.

CRGY is one of just a large database of Oils-Energy stocks with positive ESPs. Another solid-looking stock is Canadian Natural Resources (CNQ).

Canadian Natural Resources is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on October 31, 2024. CNQ's Most Accurate Estimate sits at $0.68 a share 10 days from its next earnings release.

For Canadian Natural Resources, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.66 is 2.51%.

CRGY and CNQ'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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