Will BJ's Beat Estimates Again in Its Next Earnings Report?

If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider BJ's Wholesale Club BJ. This company, which is in the Zacks Consumer Services - Miscellaneous industry, shows potential for another earnings beat.

This wholesale membership warehouse operator has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for the past two quarters of 3.56%.

For the most recent quarter, BJ's was expected to post earnings of $0.83 per share, but it reported $0.85 per share instead, representing a surprise of 2.41%. For the previous quarter, the consensus estimate was $1.06 per share, while it actually produced $1.11 per share, a surprise of 4.72%.

For BJ's, estimates have been trending higher, thanks in part to this earnings surprise history. And when you look at the stock's positive Zacks Earnings ESP (Expected Surprise Prediction), it's a great indicator of a future earnings beat, especially when combined with its solid Zacks Rank.

Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better 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 as high as seven.

BJ's currently has an Earnings ESP of +1.24%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #2 (Buy) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on August 22, 2024.

When the Earnings ESP comes up negative, investors should note that this will reduce the predictive power of the metric. But, a negative value is not indicative of a stock's earnings miss.

Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate.

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