If you're looking for a stock that has consistently beaten earnings estimates and is in a good position to continue that trend in its upcoming quarterly report, you should consider Riot Blockchain, Inc (RIOT). Part of the Zacks Technology Services sector, this company has potential for another earnings beat.
Big numbers to record
This company has had a nice run of beating earnings estimates, especially if you look at the previous two reports. The average surprise for the last two quarters was 175%.
For the most recent quarter, Riot Blockchain, Inc. was expected to post earnings of $0.08 per share, but reported $0.16 per share instead, which is a 300% surprise. For the previous quarter, the consensus estimate was $0.08 per share, whereas it actually produced $0.04 per share, a 50% surprise.
Thanks in part to this history, there has been a favourable shift in earnings estimates for Riot Blockchain, Inc. of late. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is positive, which is a great indicator of an earnings beat, especially when combined with its strong Zacks Rank.
Our research shows that stocks combining a positive ESP with a Zacks Rank #3 (Hold) or higher produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be seven.
The Zacks Earnings ESP compares the most accurate estimate to the Zacks Consensus Estimate for the quarter; the most accurate estimate is a version of the Zacks Consensus that is defined by change. The idea here is that analysts who revise their estimates just before the publication of results have the latest information, which could potentially be more accurate than they and other consensus contributors had previously predicted.
Riot Blockchain Earnings Analysis
Riot Blockchain, Inc. has an ESP of +0% at the moment, suggesting that analysts are becoming increasingly bullish on its near-term earnings potential. When you combine this positive ESP with the stock's Zacks Rank #3 (Hold), it shows that another beat may be just around the corner.
It is important to note that a negative value reduces the predictive power of the ESP. However, a negative ESP does not indicate that earnings will be insufficient.
Many companies end up exceeding the consensus estimate of earnings per share, but this is not necessarily the only reason why their shares rise. On the other hand, some shares can hold up even if they end up falling short of the consensus estimate.
For this reason, it's really important to check a company's earnings ESP before its quarterly release to increase the chances of success. Be sure to use our Earnings ESP filter to discover the best stocks to buy or sell before they are released.
