If you’re searching for a stock with a proven history of beating earnings estimates and the potential to continue this trend in the next quarter, Biogen Inc. (BIIB) should be on your radar. This company, operating within the Zacks Medical – Biomedical and Genetics industry, exhibits promising signs for another earnings beat.
Biogen has established a remarkable streak of surpassing earnings expectations, particularly in the last two reports. The average surprise for these quarters reached an impressive 19.19%. In the most recent quarter, Biogen reported earnings of $5.28 per share, exceeding the Zacks Consensus Estimate of $4 per share by a significant 32%. The previous quarter saw the company deliver earnings of $3.67 per share, surpassing the anticipated $3.45 per share by 6.38%.
This consistent outperformance has led to a positive shift in recent analyst estimates for Biogen. The Zacks Earnings ESP (Expected Surprise Prediction) for the company currently stands at a positive value, a strong indicator of a potential earnings beat. When paired with Biogen’s favorable Zacks Rank, this positive ESP takes on even greater significance. Our research reveals that stocks exhibiting this combination – a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher – have a remarkable track record of exceeding estimates nearly 70% of the time. This suggests that out of ten stocks displaying these characteristics, as many as seven could surpass the consensus estimate.
The Zacks Earnings ESP contrasts the Most Accurate Estimate with the Zacks Consensus Estimate for the quarter. The Most Accurate Estimate is a refined version of the Zacks Consensus, drawing from the latest information. The rationale is that analysts adjusting their estimates right before an earnings release are likely privy to the most current data, potentially offering a more accurate prediction compared to earlier estimates. Currently, Biogen boasts an Earnings ESP of +1.52%, reflecting a surge in analysts’ optimism regarding the company’s near-term earnings potential. Coupling this positive ESP with the stock’s Zacks Rank #3 (Hold) strongly suggests that another earnings beat could be in the offing.
Biogen’s next earnings report is scheduled for release on October 30, 2024. While a negative Earnings ESP diminishes its predictive power, it doesn’t automatically signal an earnings miss. Many companies surpass the consensus EPS estimate, but this may not be the sole driver of their stock’s appreciation. Conversely, some stocks might hold their ground even if they fail to meet the consensus estimate. In light of this, thoroughly examining a company’s Earnings ESP before its quarterly release is crucial to optimize your chances of success.
