These 2 Oils and Energy Stocks Could Beat Earnings: Why They Should Be on Your Radar

Zacks Investment Research highlights its proprietary Earnings ESP (Expected Surprise Prediction) methodology as a robust tool for identifying stocks likely to surpass quarterly earnings expectations. The system, which combines a positive ESP (derived from the most accurate analyst estimate versus consensus) with a Zacks Rank #3 (Hold) or stronger, has historically led to positive bottom-line surprises 70% of the time and delivered an average annual return of approximately 28% over a 10-year backtest. Currently, ConocoPhillips (COP) with an 8.04% ESP and Oneok Inc. (OKE) with a 6.56% ESP are identified as oil and energy stocks with a high probability of beating analyst estimates in their upcoming reports, presenting potential earnings-driven trading opportunities.

Analysis

The analysis highlights a quantitative strategy, the Zacks Earnings ESP, for identifying potential positive earnings surprises, which historically has yielded a 70% success rate when combined with a Zacks Rank of #3 (Hold) or better. According to the model's 10-year backtest, this approach has generated average annual returns of approximately 28%. Currently, two energy sector stocks, ConocoPhillips (COP) and Oneok Inc. (OKE), are flagged by this system. ConocoPhillips exhibits a positive Earnings ESP of +8.04%, derived from its Most Accurate Estimate of $1.50 per share versus a consensus of $1.38, ahead of its August 7, 2025 report. Similarly, Oneok Inc. shows a positive ESP of +6.56%, with a Most Accurate Estimate of $1.45 against a consensus of $1.36 for its August 4, 2025 earnings release. Despite both stocks carrying a neutral Zacks Rank #3 (Hold), which projects in-line market performance, their significant positive ESPs suggest a high statistical probability of beating near-term earnings expectations, creating a potential event-driven catalyst.

Key Decisions for Investors

• Investors could consider tactical long positions in ConocoPhillips (COP) and Oneok Inc. (OKE) ahead of their early August earnings reports to capitalize on the high probability of a positive earnings surprise.
• It is important to recognize that the primary signal is for a short-term, event-driven trade, as both companies currently hold a Zacks Rank #3 (Hold), implying neutral long-term performance relative to the market.
• Traders employing quantitative strategies should monitor the Zacks Earnings ESP filter for other potential candidates that meet the criteria of a positive ESP and a Zacks Rank of #3 or better to identify similar opportunities across various sectors.