For Immediate Release
Chicago, IL – March 1, 2010 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Arena Resources (ARD), Big Lots (BIG), Costco (COST), Arcsight (ARST) and Churchill Downs (CHDN). To see more earnings analysis, visit http://at.zacks.com/?id=3207.
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Earnings Season Almost Complete
Historically the best indicators of firms likely to report positive surprises are a recent history of positive surprises and rising estimates going into the report. The Zacks Rank is also a good indicator of potential surprises. While normally firms that report better-than-expected earnings rise in reaction, that has not been the case so far this quarter. Some of the companies that have these characteristics include:
Arena Resources (ARD) is expected to report EPS of $0.35, up from $0.27 per share a year ago. Last time out, ARD posted a positive surprise of 19.2%, and over the last month the mean estimate for its fourth quarter earnings is up 5.53%. ARD has a Zacks #1 Rank.
Big Lots (BIG) is expected to report EPS before non-recurring items of $1.29, up from $1.00 a year ago. In the 3Q, BIG posted a positive surprise of 50.0% and over the last month, the consensus estimate for its 4Q earnings is up 4.34%. BIG is a Zacks #1 Ranked stock.
Costco (COST) is expected to earn $0.71 per share this year, up from $0.65 a year ago. In the third quarter, the company posted a 1.69% positive surprise. Over the last month the mean estimate for the 4Q is up 0.46%. COST holds a Zacks #2 Rank.
Potential Negative Surprises
Arcsight (ARST) is expected to post $0.16 a share, an improvement over the $0.11 a share a year ago. Last time they reported 12.50% expectations. For this Zacks #4 Ranked stock, analysts have cut the estimates for this quarter slightly over the last month by 0.89%.
Churchill Downs (CHDN) looks like a losing bet. It is expected to lose $0.18 a share this quarter, which is an improvement over the $0.26 they lost a year ago. They had a negative surprise of 68.0% last time out, and analysts have cut their estimates for this quarter by 12.9% over the last month. The stock holds a Zacks #4 Rank.
Dirk Van Dijk, CFA, is the Chief Equity Strategist for Zacks.com.
About the Zacks Rank
Since 1988, the Zacks Rank has proven that “Earnings estimate revisions are the most powerful force impacting stock prices.” Since inception in 1988, #1 Rank Stocks have generated an average annual return of +26%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have underperformed the S&P 500 by 111% annually (-0.8% versus +8%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
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Contact: Dirk Van Dijk, CFA
Company: Zacks.com
Phone: 312-265-9211
Email: pr@zacks.com
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