These 2 Retail and Wholesale Stocks Could Beat Earnings: Why They Should Be on Your Radar

Zacks identifies Ulta Beauty and Starbucks as potential earnings-beat candidates based on positive Earnings ESPs and #3 (Hold) ranks. Ulta's estimate is $5.70 per share versus $5.60 consensus, for a +1.84% ESP, ahead of its December 3, 2026 report; Starbucks' estimate is $0.76 versus $0.75 consensus, for a +1.10% ESP, ahead of its January 27, 2027 report. The article cites Zacks' historical backtest, in which stocks meeting its positive-ESP and rank criteria produced positive surprises 70% of the time and averaged 28.3% annual returns; neither company has reported these upcoming results yet.

Analysis

The signal is a small estimate-revision edge, not evidence of improving demand or earnings quality. The promotional backtest is not enough to underwrite either stock without its methodology, current estimate history, and evidence that revisions are broad-based rather than one analyst’s update. A beat can still produce a selloff if guidance, comparable sales, margins, or the post-report bar disappoint.

Over the next month, ULTA is the cleaner event to monitor; its nearer report offers a more timely test, but the modest ESP does not justify assuming positive skew. For Starbucks, the longer runway makes today’s estimate signal less durable: intervening traffic, pricing, labor, and turnaround updates can reset expectations before the report. In both cases, weaker discretionary spending could pressure volumes, while promotions and input or wage costs can turn revenue resilience into margin deterioration. Beauty demand may be more resilient than discretionary categories, but that is a hypothesis to verify, not a reason to infer a ULTA beat.

Contrarian point: the article frames a beat as a potential catalyst, but the tradeable variable is the gap between expectations and forward guidance—not the beat itself. The move may already be priced if consensus revisions and positioning have caught up. Falsify a constructive view with deteriorating sales/traffic indicators, downward estimate revisions, or guidance that implies margin pressure; validate it with sustained estimate breadth and results that improve forward expectations.

Key Decisions for Investors

• Do not buy either stock solely on the ESP screen. Before taking event risk, verify the latest consensus and estimate-revision breadth, company-specific sales and margin indicators, and options-implied move; these details are absent from the article.
• Treat ULTA as a watch-list event trade into its December report, not a current conviction long. Consider a defined-risk bullish position only if revisions broaden and operating indicators confirm demand; exit or stand aside if estimates turn negative or management signals weaker comparable sales or margins.
• Defer a SBUX earnings trade until closer to its January report. Reassess after intervening traffic, labor-cost, and turnaround updates; the current signal has a longer window to decay or reverse.
• If a post-report beat is accompanied by weak forward guidance or margin deterioration, fade the initial relief move rather than treating the headline beat as confirmation. Compare the stock reaction with its implied move and sector peers before adding risk.