For Immediate Release
Chicago, IL – December 14, 2009 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Federal Express (FDX), General Mills (GIS), Joy Global (JOYG) and Applied Signal (APSG). To see more earnings analysis, visit http://at.zacks.com/?id=3207.
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Potential Positive Surprises
Historically, the best indicators of firms which are 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. Some of the companies that have these characteristics include:
Federal Express (FDX) is expected to post EPS of $1.06, down from $1.58 last year. That low expectation sets it up for a positive surprise. Last time out they just met expectations, but the stock holds a coveted Zacks Rank #1 and over the last month the expectations for the about-to-be-reported quarter have jumped by 25.7%.
General Mills (GIS) is expected to report EPS of $1.45 vs. $1.36 a year ago. The mean estimate for the quarter has edged up by 0.8% over the last month and last time out the company posted a positive surprise of 24.3%. The stock holds a Zacks Rank of 2.
Joy Global (JOYG), the maker of mining machines, is expected to see EPS drop to $1.01 from $1.23 last year. However, last time out it posted a 26% positive surprise and the estimates for this quarter have edged up by 0.8% over the last month. The stock holds a Zacks Rank of 2.
Potential Negative Surprises
In keeping with the overall very positive tone of this earnings season, the potential negative firms are less clear cut. However:
Applied Signal (APSG) is expected to post EPS of $0.24 a share, up from $0.20 a year ago. Last time they disappointed by 3.85%. The mean estimate for the quarter is down 0.9% over the last month and the stock has a weak Zacks Rank of 4.
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
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