These stocks reporting earnings next week usually beat the Street's estimates and rally afterward

A CNBC analysis, leveraging Bespoke Investment Group data, identifies several companies with a strong history of outperforming earnings expectations and generating subsequent stock gains, positioning them as potential focuses for the current earnings season. CyberArk Software, F5 Networks, and Meta Platforms are highlighted for consistently beating estimates (98%, 86%, and 89% of the time, respectively) and averaging post-earnings share price increases ranging from 2.2% to 2.85%, suggesting a pattern of positive market reaction to their financial results.

Analysis

This analysis highlights a CNBC screen identifying companies with a strong historical propensity to exceed Wall Street earnings expectations and subsequently experience significant stock gains. The criteria for inclusion were a beat rate of at least 75% and an average next-day trading session gain of 2% or more following quarterly reports, suggesting a pattern of positive market reaction to fundamental performance. This screen serves as a valuable tool for investors seeking high-performing stocks during the current earnings season.

CyberArk Software (CYBR) and Meta Platforms (META) exemplify this trend, with CYBR beating estimates 98% of the time and averaging a 2.85% post-earnings gain, while META boasts an 89% beat rate and a 2.2% average gain. Both companies have demonstrated robust recent share price momentum, with CYBR climbing 56% and META surging 47% over the past six months, indicating strong investor confidence ahead of their respective reports.

F5 Networks (FFIV) also features with an 86% beat rate and a 2.2% average earnings day gain, aligning with the positive post-earnings performance theme. However, FFIV experienced a notable 10% single-day decline earlier in October following a system breach disclosure, introducing a specific operational risk factor despite its 17% share price appreciation over the last six months.

Key Decisions for Investors

• Consider CyberArk Software (CYBR) and Meta Platforms (META) for potential positive earnings catalysts, given their strong historical beat rates and post-earnings stock performance and recent share price momentum
• Investors should conduct further due diligence on F5 Networks (FFIV), balancing its consistent earnings beats against the recent system breach and its potential implications for future performance or sentiment
• Utilize these identified companies as a starting point for deeper fundamental analysis, focusing on their current quarter's guidance, competitive landscape, and any new operational developments