Should You Buy Accuride (ACW) Ahead of Earnings? - Tale of the Tape
April 24 2014 - 8:57AM
Zacks
Investors are always looking for stocks that are
poised to beat at earnings season and Accuride
Corp. (ACW) may be one such company. The firm has earnings
coming up pretty soon, and events are shaping up quite nicely for
their report.
That is because Accuride is seeing favourable earnings estimate
revision activity as of late, which is generally a precursor to an
earnings beat. After all, analysts raising estimates right before
earnings—with the most up-to-date information possible—is a pretty
good indicator of some favourable trends underneath the surface for
ACW in this report.
In fact, the Most Accurate Estimate for the current quarter is
currently at a loss of 8 cents per share for ACW, compared to a
broader Zacks Consensus Estimate of a loss of 14 cents per share.
This suggests that analysts have very recently bumped up their
estimates for ACW, giving the stock a Zacks Earnings ESP of 42.86%
heading into earnings season.
Why is this Important?
A positive reading for the Zacks Earnings ESP has proven to be very
powerful in producing both positive surprises, and outperforming
the market. Our recent 10 year back test shows that stocks that
have a positive Earnings ESP and a Zacks Rank #3 (Hold) or better
show a positive surprise nearly 70% of the time, and have returned
over 28% on average in annual returns (see more Top Earnings ESP
stocks here).
Given that ACW has a Zacks Rank #3 (Hold) and an ESP in positive
territory, investors might want to consider this stock ahead of
earnings. Clearly, recent earnings estimate revisions suggest that
good things are ahead for Accuride, and that a beat might be in the
cards for the upcoming report.
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