Looking for Earnings Beat? Buy These 5 Top-Ranked Stocks

Zacks Investment Research ran a quantitative screen to identify stocks with a high probability of beating upcoming earnings, requiring last EPS surprise ≥10%, average EPS surprise >20% over the last two and four quarters, Zacks Rank ≤2, positive Earnings ESP, >10% expected EPS growth over 3–5 years and average 20‑day volume >100,000, narrowing a 7,700+ universe to 19 names. Five highlighted candidates with strong recent surprise histories are Urban Outfitters (URBN, 4‑quarter avg surprise 22.82%, Zacks #1), Leidos (LDOS, 29.92%, #2), Fortinet (FTNT, 24.76%, #1), Affirm (AFRM, 84.09%, #1) and Zillow Class C (Z, 25.47%, #1), each of which the report suggests could see outsized post‑release moves if they again top consensus. The screen’s focus on consistent surprise, growth and liquidity makes these stocks actionable candidates to consider ahead of earnings, noting the article also promotes Zacks’ Research Wizard and includes standard firm disclosures.

Analysis

Zacks ran a quantitative screen that required last EPS surprise ≥10%, average EPS surprise >20% over the last two and four quarters, Zacks Rank ≤2, positive Earnings ESP, next 3–5 year EPS growth >10% and average 20‑day volume >100,000, narrowing a 7,700+ universe to 19 names and highlighting five candidates: URBN (4‑quarter avg surprise 22.82%, Zacks #1), LDOS (29.92%, #2), FTNT (24.76%, #1), AFRM (84.09%, #1) and Z (25.47%, #1). The screen is explicitly designed to identify stocks with a pattern of upside surprises because Zacks argues that beating consensus typically drives immediate post‑release rallies.

The report emphasizes that consistent surprise history is a leading indicator of repeat beats; Affirm’s 84.09% four‑quarter average is a clear outlier that, if repeated, could produce disproportionate upside, while the other names show mid‑20% surprise histories consistent with the screen’s thresholds. Sentiment and market‑impact signals are moderately positive (sentiment_score 0.45; market_impact_score 0.28), implying constructive but limited market enthusiasm rather than broad consensus momentum.

Key risks noted in the article include seasonality and guidance effects that can produce sequential earnings declines despite year‑over‑year growth, and the fundamental limitation that past surprises do not guarantee future beats. The piece is promotional for Zacks’ Research Wizard and includes a standard disclosure that Zacks employees or affiliates may hold positions in mentioned securities, so the screen’s outputs should be independently verified before allocating capital.

Key Decisions for Investors

• Consider small, tactical long exposure or defined‑risk option strategies into the highlighted names ahead of earnings, prioritizing AFRM given its 84.09% four‑quarter average EPS surprise but size positions to limit single‑report risk
• Avoid holding large, unhedged positions through the reports and use protective hedges or profit‑taking triggers because the article highlights that misses or merely meeting expectations can lead to sharp share declines
• Verify current Earnings ESP, Zacks Rank, consensus estimates and exact earnings dates for URBN, LDOS, FTNT, AFRM and Z and perform independent valuation and liquidity checks on the remaining screened names before trading
• Factor in potential selection bias from the promotional nature of the piece and disclosed firm holdings by corroborating the screen with independent research and limiting exposure until you see either confirmed beats or post‑report price confirmation