The important surprises are those associated with forecast errors that are large by historical standards. To account for this, a forecast error can be related to previous errors by meanings of Standardized Unexpected Earnings (SUE).
SUE effectively minimizes the earnings surprise in a particular quarter by a measure of the typical surprise in an average quarter. This discounts forecast errors for firms with historically very unpredictable earnings. A large error for such a firm might not be as significant as for a firm with typically very predictable earnings.
This report rates companies by Standardized Unexpected Earnings - (SUE) - a measurement of the deviation of 12-month actual EPS from the 5-year EPS growth trend line.
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