For Immediate Release
Chicago, IL – May 17, 2010 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Gap (GPS), Limited (LTD), Sears Holdings (SHLD), Hot Topic (HOTT) and MF Global (MF). To see more earnings analysis, visit http://at.zacks.com/?id=3207.
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It’s Retail’s Turn
Potential Positive Surprises
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. While pickings are getting slim, some of the companies that have these characteristics include:
Gap (GPS) is expected to report EPS of $0.43, up from $0.31 per share a year ago. Last time out, GPS posted a positive surprise of 2.0%, and over the last month the mean estimate for its first quarter earnings is up 10.07%. GPS has a Zacks #1 Rank.
Limited (LTD) is expected to post EPS of $0.19, up from $0.01 a year ago. Last time, LTD beat expectations by 3.06%, and over the last month analysts have raised their estimates for the about-to-be-reported quarter by 17.2%. LTD is a Zacks #1 Ranked stock.
Sears Holdings (SHLD) is expected to post EPS of $0.14 down from $0.39 a year ago. Last time out, the company beat expectations by 4.24%. Over the last month, estimates for the quarter are up 288.9%. SHLD is a Zacks #1 Ranked stock.
Potential Negative Surprises
Hot Topic (HOTT) is expected to post a loss of $0.05 a share, versus EPS of $0.03 a year ago. Last time they reported in line with expectations. For this Zacks #4 Ranked stock, analysts have cut the estimates for this quarter over the last month by 40.4%.
MF Global (MF) is expected to earn $0.01 a share this quarter, versus a loss of $0.25 a year ago. This was below expectations by 600.0% last time out (a loss when positive earnings were expected). Analysts have cut the estimate for this quarter by 27.27% 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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