Why Investors Need to Take Advantage of These 2 Computer and Technology Stocks Now

Zacks identifies ON Semiconductor (ON) and Affirm Holdings (AFRM) as potential earnings-beat candidates, with positive Earnings ESPs of 5.20% and 11.03%, respectively; both carry a Zacks Rank #3 (Hold). ON is scheduled to report November 2, 2026, with estimates of $0.92 per share versus $0.87 consensus, while Affirm is scheduled for November 5, 2026, with $0.39 versus $0.35. Zacks says positive ESP combined with a rank of #3 or better preceded positive surprises 70% of the time in its analysis; these are forecasts, not reported results.

Analysis

The signal here is not demonstrated earnings power but a small gap between one “most accurate” estimate and consensus. That is a fragile basis for taking event risk: the cited historical hit rate is not evidence that either name has a positive expected return after the market’s expectations, valuation, and options-implied move are accounted for. The promotional backtest also needs scrutiny for sample construction, transaction costs, and out-of-sample performance.

For ON, a beat matters only if it reflects durable demand, utilization, or pricing—not timing, mix, or cost actions. Read guidance for auto/industrial end-market stabilization and inventory normalization; sustained weakness would leave the shares exposed to another estimate reset. Relevant competitive read-throughs include Infineon, STMicroelectronics, NXP, and Texas Instruments, but product and end-market overlap should be verified before treating any as a hedge.

For Affirm, the higher estimate gap is not automatically the better setup: an EPS beat could coexist with deteriorating consumer credit or more expensive funding. Delinquencies, net charge-offs, loan-sale/securitization economics, and volume quality matter more than a headline beat. PayPal and Block offer partial competitive read-throughs, not clean hedges.

Near-term, the November reports are binary catalysts; over 1–3 months, revisions and guidance quality should dominate the initial surprise. Over 6–18 months, ON’s exposure to cyclical end markets and AFRM’s ability to grow without weakening credit economics are the structural tests. A positive print with weak forward commentary could reverse any relief rally.

Key Decisions for Investors

• Do not buy either stock solely on the reported ESP figures. Before considering event exposure, verify current estimate-revision breadth, valuation, options-implied moves, and whether the implied move is cheap relative to realized earnings reactions.
• ON: place on a pre-earnings watchlist, not a standalone long yet. Consider a defined-risk bullish position only if subsequent revisions broaden and guidance indicators support end-market stabilization; reduce or avoid exposure if management signals renewed inventory or demand weakness.
• AFRM: treat as the higher-risk event setup despite the larger estimate gap. Require stable or improving credit-quality and funding indicators before taking a bullish position; an EPS beat paired with worsening delinquencies or weaker unit economics would invalidate the thesis.
• Use the report and subsequent guidance as the catalyst test. A beat without improved forward estimates is a sell-the-news risk; a miss, downward guidance revision, or adverse credit trend for Affirm would falsify the positive setup. No trade is warranted if the missing pricing and fundamentals checks do not confirm an attractive risk/reward.