Looking for Stocks with Positive Earnings Momentum? Check Out These 2 Basic Materials Names

Zacks highlights its proprietary Earnings ESP (Expected Surprise Prediction) tool, designed to identify stocks likely to beat quarterly earnings estimates by comparing the Most Accurate Estimate to the Zacks Consensus Estimate. When combined with a Zacks Rank #3 (Hold) or better, this methodology has historically predicted positive earnings surprises 70% of the time and generated an average annual return of 28.3% over a 10-year backtest. The article cites Newmont Corporation (NEM), with a +8.14% ESP and a #1 Strong Buy Rank, and Alamos Gold (AGI), with a +2.78% ESP and a #3 Hold Rank, as current examples signaling potential positive earnings surprises, offering investors a data-driven approach to pre-earnings trading.

Analysis

The Zacks investment thesis centers on its proprietary Earnings Expected Surprise Prediction (ESP) metric, which historically identifies stocks poised for a positive earnings surprise with 70% accuracy when combined with a Zacks Rank of #3 (Hold) or better. According to a 10-year backtest, this strategy has yielded an average annual return of 28.3%. The analysis highlights two specific opportunities within the Basic Materials sector based on this model. Newmont Corporation (NEM) is presented as a primary candidate, holding a #1 (Strong Buy) rating and a significant positive Earnings ESP of +8.14%. This is calculated from its Most Accurate Estimate of $1.09 per share compared to the Zacks Consensus Estimate of $1.01 ahead of its July 23, 2025 earnings report. A secondary, more muted signal is noted for Alamos Gold (AGI), which has a #3 (Hold) rating and a positive ESP of +2.78%, based on a Most Accurate Estimate of $0.37 versus a consensus of $0.36. The positive ESP figures for both companies suggest that recent analyst revisions are more optimistic than the broader consensus, indicating a quantifiable probability of an upcoming earnings beat for both firms, with a stronger conviction for NEM.

Key Decisions for Investors

• Investors could consider initiating or adding to positions in Newmont Corporation (NEM) ahead of its July 23, 2025 earnings release, as its #1 Strong Buy rating and +8.14% Earnings ESP suggest a high probability of a positive earnings surprise and potential near-term stock appreciation.
• Alamos Gold (AGI) represents a secondary opportunity with a positive, albeit smaller, ESP of +2.78%; its #3 Hold rating suggests it is more likely to perform in line with the market, making it a more conservative consideration for a potential earnings beat.
• The investment thesis for both stocks is event-driven and tied to pre-earnings positioning, requiring investors to monitor positions closely around the late-July 2025 reporting dates to manage potential post-announcement volatility.