These 2 Consumer Staples Stocks Could Beat Earnings: Why They Should Be on Your Radar

Zacks highlights the potential for earnings beats in consumer staples stocks Smucker (SJM) and RH, based on their positive Earnings ESP (Expected Surprise Prediction), which identifies stocks with recent upward analyst revisions; SJM, with an ESP of +0.74%, reports earnings June 10, 2025, while RH, with an ESP of +9.8%, reports June 12, 2025. Zacks' backtesting indicates that stocks with a Zacks Rank #3 (Hold) or better and a positive Earnings ESP have historically produced positive surprises 70% of the time, with average annual returns of 28.3%.

Analysis

The Zacks Earnings ESP (Expected Surprise Prediction) model highlights Smucker (SJM) and RH as companies poised for potential earnings beats in their upcoming quarterly reports. SJM, with a Zacks Rank #3 (Hold), shows an Earnings ESP of +0.74%, reflecting a Most Accurate Estimate of $2.26 per share against a Zacks Consensus Estimate of $2.25, ahead of its June 10, 2025 earnings release. RH, also a Zacks Rank #3 (Hold), exhibits a stronger ESP of +9.8%, with its Most Accurate Estimate at -$0.08 per share compared to a consensus of -$0.09, for its earnings report due on June 12, 2025. The Zacks methodology, which focuses on recent analyst estimate revisions, indicates that stocks with a Zacks Rank #3 or better combined with a positive ESP have historically delivered a positive earnings surprise 70% of the time, achieving average annual returns of 28.3% based on a 10-year backtest. This suggests that recent analyst sentiment for both SJM and RH is positive regarding their near-term earnings potential, despite their neutral 'Hold' ratings which typically anticipate in-line market performance.

Key Decisions for Investors

• Investors might consider tactical positioning in Smucker (SJM) and RH ahead of their respective earnings announcements on June 10 and June 12, 2025, due to their positive Earnings ESP figures which suggest a heightened probability of an earnings beat.
• Given that both SJM and RH hold a Zacks Rank #3 (Hold), the primary opportunity indicated by the positive ESP is likely event-driven around the earnings release, rather than a signal for broad outperformance unless the earnings surprise significantly alters their outlook.
• Closely monitor the actual earnings results and subsequent management guidance for SJM and RH to ascertain if the potential earnings beat translates into a sustained positive impact on their stock valuations.