Why Asbury Automotive, (ABG), is Poised to Beat Earnings Expectations Again
You are looking for a stock that consistently beats earnings estimates and could be well placed to continue this streak in its next quarter’s report. Asbury Automotive Group, which is part of the Zacks Automotive Retail and Whole Sales industry could be a good candidate.
The auto dealership chain has surpassed earnings estimates in both of its last two reports. The company’s earnings estimates have been beaten by an average of 6.75% in the last two quarters.
Asbury Automotive was expecting to earn $9.19 per share for its most recent quarter. However, it actually earned $9.23 per share. This surprise is 0.4%. It actually produced $10.04 per shares, an unexpected 13.06% increase from the $8.88 consensus estimate.
Surprises in Price and EPS
Asbury Automotive’s earnings history is a key factor in recent estimates moving higher. The Zacks Earnings ESP, or Expected Surprise Prediction, for the company is actually positive. This is a good sign that the company has beat earnings expectations, especially when combined this metric with the Zacks Rank.
Our research shows that stocks that have a positive Earnings ESP, a Zacks Rank (3 (Hold), or better) produce a positive surprise about 70% of times. If you have 10 stocks that combine this combination, it could lead to seven stocks beating the consensus estimate.
The Zacks Earnings ESP compared the Most Accurate Estimate and the Zacks Consensus Estimate of the quarter. The Most Accurate Estimate, which is a version Zacks Consensus whose definition includes change, is the Zacks Consensus’ most accurate estimate. This is because analysts who revise their estimates before earnings releases have the most current information. It could be that this information will prove to be more accurate than what others contributed to the consensus.
Asbury Automotive has an EarningsESP of +0.48%. This suggests that analysts are now bullish about the company’s prospects. The stock’s Zacks Rank #3, which is a Hold, has a positive Earnings ESP. This suggests that there may be another win. The company’s next earnings report will be published on February 2, 2023.
Investors should take note of the fact that if Earnings ESP turns negative, it will lower the predictive power. However, a negative Earnings ESP value does not necessarily indicate that a stock is missing its earnings.
Although many companies surpass the consensus EPS estimate and their stock prices rise, it may not be the only reason. Some stocks might hold their ground, even if they miss the consensus estimate.
It is important to verify a company’s Earnings ESP prior to its quarterly release. This will increase the chances of success. Our Earnings ESP Filter will help you find the best stocks to purchase or sell before they report.
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Asbury Automotive Group, Inc. (ABG) : Free Stock Analysis Report