When you invest in a stock, one of the best things you can see is analysts raising their expectations about what the company is going to earn for the current fiscal year. There are several ways of measuring this, but the following is a list of the companies with the biggest increases in their consensus earnings expectations for this year over the last month.
To make the list, a company had to have a current mean (average) estimate of over 50 cents, be a member of the S&P 500 and have at least three estimates for this year. The 50-cent restriction was put in to prevent small dollar changes that are huge percentage moves from dominating the list (going from a penny expected to a nickel). Having 3 or more estimates also helps insure it was not a fluke. The S&P 500 restriction was put in to make sure we are dealing with substantial companies.
Most likely these firms either reported much better than expected earnings, or communicated better times coming in their conference calls to the analysts after earnings were announced. Notice that there are companies from a wide variety of industries on this list. Often the best strategy is to pick stocks where the overall level of expectations is low — for example, where the expected earnings level for this year is well below last year’s level, but where the analysts are starting to think that things might just be bad, not a disaster. The low level of earnings causes the stock price to be depressed, and when the worst does not happen, the stock rebounds.
Also, a consensus estimate in motion tends to remain in motion (notice how for most of the firms the 12-week change is larger than the 4-week change). If the analysts have been raising their estimates, they are far more likely to continue raising them than turn the other direction and start cutting them. Having a large number of estimates moving in the same direction has also been useful in predicting which direction a stock is likely to go in the near future.
This list is a good starting point to investigate companies that might be worth investing in.
I will post a second list with the stocks with the biggest estimate cuts shortly, which if they are in your portfolio should be candidates for culling from the herd.
| Company | Ticker | 2009 Zacks Consensus |
4-Week % Change |
Positive Revisions |
Negative Revisions |
EPS Growth |
P/E |
| Intl Paper | IP | $0.60 | 400.00% | 12 | 0 | -70.30% | 33.63 |
| Fifth Third Bk | FITB | $0.77 | 201.85% | 14 | 0 | 135.12% | 12.57 |
| Hess Corp | HES | $1.10 | 116.78% | 7 | 1 | -84.98% | 49.8 |
| Freept Mc Cop-B | FCX | $2.59 | 69.00% | 10 | 1 | -62.19% | 24.45 |
| Western Digital | WDC | $3.04 | 43.58% | 11 | 0 | 19.56% | 10.53 |
| Caterpillar Inc | CAT | $1.49 | 32.59% | 14 | 1 | -73.67% | 32.07 |
| Avery Dennison | AVY | $1.78 | 27.18% | 8 | 0 | -41.76% | 15.47 |
| Franklin Resour | BEN | $3.34 | 21.46% | 13 | 1 | -49.95% | 28.23 |
| Cameron Intl | CAM | $2.22 | 19.04% | 13 | 0 | -17.01% | 15.37 |
| Apache Corp | APA | $4.86 | 18.07% | 14 | 1 | -58.18% | 17.93 |
| Noble Energy | NBL | $2.82 | 17.90% | 12 | 1 | -60.04% | 21.44 |
| Whirlpool Corp | WHR | $3.89 | 17.30% | 5 | 0 | -29.24% | 15.87 |
| Texas Instrs | TXN | $0.84 | 17.21% | 25 | 1 | -44.67% | 28.66 |
| Goldman Sachs | GS | $15.25 | 16.74% | 16 | 1 | 241.21% | 10.73 |
| Gannett Inc | GCI | $1.53 | 15.69% | 5 | 0 | -57.54% | 5.05 |
| Wells Fargo-New | WFC | $1.66 | 15.18% | 17 | 2 | 120.93% | 17.36 |
| Expedia Inc | EXPE | $1.13 | 14.97% | 10 | 0 | -1.67% | 19.92 |
| Jpmorgan Chase | JPM | $1.61 | 14.76% | 10 | 3 | 93.75% | 26.34 |
| Eastman Chem Co | EMN | $2.89 | 14.07% | 7 | 0 | -35.83% | 18.26 |
| Coca-Cola Entrp | CCE | $1.50 | 14.00% | 7 | 0 | 13.26% | 12.99 |
| Intuitive Surg | ISRG | $5.27 | 13.46% | 12 | 0 | 2.95% | 43.66 |
| Black & Decker | BDK | $1.78 | 13.37% | 9 | 0 | -63.57% | 23.25 |
| Corning Inc | GLW | $1.17 | 12.08% | 13 | 0 | -25.76% | 14.54 |
| Autonation Inc | AN | $1.03 | 11.00% | 6 | 1 | 2.73% | 19.45 |
| Whole Foods Mkt | WFMI | $0.85 | 10.93% | 7 | 0 | -19.98% | 33.51 |
| Radioshack Corp | RSH | $1.53 | 10.41% | 15 | 0 | 0.54% | 10.6 |
| Newell Rubbermd | NWL | $1.26 | 10.23% | 10 | 0 | 3.07% | 11.02 |
| Devon Energy | DVN | $2.99 | 10.12% | 10 | 2 | -69.78% | 21.31 |
| T Rowe Price | TROW | $1.42 | 9.91% | 15 | 2 | -22.13% | 34.36 |
| Pactiv Corp | PTV | $2.40 | 9.86% | 8 | 0 | 37.20% | 10.82 |
| Iron Mountain | IRM | $0.94 | 9.75% | 6 | 0 | 25.04% | 31.46 |
| 3M Co | MMM | $4.19 | 9.32% | 16 | 0 | -18.74% | 17.39 |
| Fmc Tech Inc | FTI | $2.60 | 9.23% | 10 | 0 | -4.26% | 16.76 |
| Invesco Ltd | IVZ | $0.70 | 8.84% | 13 | 2 | -46.52% | 29.51 |
| Cf Indus Hldgs | CF | $7.60 | 8.75% | 4 | 1 | -47.29% | 10.98 |
| Amerisourcebrgn | ABC | $1.77 | 8.47% | 13 | 1 | 22.54% | 11.49 |
| Tjx Cos Inc New | TJX | $2.36 | 8.29% | 14 | 0 | 17.45% | 15.03 |
| Mylan Inc | MYL | $1.16 | 8.05% | 14 | 0 | 45.00% | 11.37 |
Read the full analyst report on “IP”
Read the full analyst report on “FITB”
Read the full analyst report on “HES”
Read the full analyst report on “FCX”
Read the full analyst report on “WDC”
Zacks Investment Research
