This report forecasts potential EPS surprises in the next several days (you can specify the number of days: 5, 30, 60, etc.). This report predicts earnings surprises by exploiting the differences between the most accurate analysts' EPS consensus and the general consensus estimate (on a quarterly basis).
Zacks' methodology for identifying the most accurate analysts is based on computing the historical errors of an analyst. The error is calculated as the actual EPS minus the quarter end estimate. Analysts with the smallest errors are considered to be the best analysts. Then analysts are ranked based on a historical average of the absolute error for the two most recently reported quarter end forecasts, with the smallest errors being the best.
The expected surprise in this report is calculated as [(Most Accurate Consensus Estimate – Consensus Estimate)/Consensus Estimate] x100 %.
The potential surprises are then "normalized" (divided by the Standard Deviation of Consensus) and ranked. This rank is determined as [(Most Accurate Consensus – Consensus Estimate)/Standard Deviation of Consensus]. The higher the Surprise Rank, the more there is a potential for a surprises.
Additional information provided by this report includes: quarter end month, number of estimates for each company, and expected report date.
Note: This report may not be included in your subscription.
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