6. Earnings Forecast - The NASDAQ Dozen

Earnings Forecast, the next metric in your stock analysis, is also located on the Stock Research page. To access it, click on the Forecast link at the top of the page (see Figure 11).

Why We Look at Earnings Forecasts

While it is very important to research a stock's past earnings reports, it is also important to look at the future earnings forecasts to insure that the future profitability of the stock in question is strong.

How to Score Earnings Forecast
  • Pass—Give the earnings forecast a passing score if the consensus EPS forecast numbers increase year over year.
  • Fail—Give the earnings forecast a failing score if the consensus EPS forecast numbers do not increase year over year.

Looking at the earnings forecast for WMT in Figure 11, WMT should receive a passing score. You can see that the consensus EPS forecast numbers are increasing year over year.

Earnings Forecast: PASS

Consensus Earnings Forecasts
Figure 11—Consensus Earnings Forecasts

  All content in this article is supplied by Wade Hansen of Learning Markets. To learn more about their investor education offerings, please visit learningmarkets.com. Find more great articles from Learning Markets in our news sections.

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