Why Investors Need to Take Advantage of These 2 Construction Stocks Now

Zacks Investment Research promotes its Earnings ESP tool, which identifies potential earnings surprises by comparing the Most Accurate Estimate to the Zacks Consensus Estimate. Historically, a positive ESP combined with a Zacks Rank #3 or better has led to positive surprises 70% of the time and 28.3% average annual returns. Utilizing this method, TopBuild (BLD) and Johnson Controls (JCI) are highlighted as strong candidates for upcoming earnings beats, with BLD showing a +1.89% ESP for its November 4, 2025 report and JCI a +2.79% ESP for its November 5, 2025 report, suggesting both could exceed analyst expectations.

Analysis

The Zacks Earnings ESP (Expected Surprise Prediction) tool is highlighted as a method to identify potential earnings beats, focusing on recent analyst revisions that create a percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. Historically, combining a Zacks Rank #3 (Hold) or better with a positive Earnings ESP has yielded a positive surprise 70% of the time, demonstrating an average annual return of 28.3% over a 10-year backtest. This suggests a robust predictive capability for short-term stock price movements around earnings announcements.

Applying this methodology, TopBuild (BLD) and Johnson Controls (JCI) are presented as construction sector stocks with favorable indicators. BLD, a Zacks Rank #3 (Hold), exhibits a +1.89% Earnings ESP, derived from a Most Accurate Estimate of $5.32 against a $5.22 consensus for its November 4, 2025 earnings release. Similarly, JCI, also a Zacks Rank #3 (Hold), shows a +2.79% ESP, with a Most Accurate Estimate of $1.22 versus a $1.19 consensus for its November 5, 2025 report.

These positive ESP figures imply a high probability that both BLD and JCI could surpass their respective bottom-line consensus estimates in their upcoming reports. Such earnings beats, if realized, are historically associated with positive near-term stock price reactions, aligning with the optimistic sentiment surrounding these predictions and the tool's proven track record.

Key Decisions for Investors

• Investors should closely monitor the upcoming earnings reports for TopBuild (BLD) and Johnson Controls (JCI) in early November 2025, given their positive Earnings ESPs and Zacks Rank #3 ratings which suggest a high probability of beating consensus estimates.
• Consider evaluating the short-term trading opportunities around these earnings events, as historical data indicates a strong correlation between positive ESPs and favorable stock price movements post-announcement.
• Assess the broader construction sector for other companies exhibiting similar positive Earnings ESP signals, potentially leveraging this analytical framework for identifying additional alpha generation opportunities.