Why the Earnings Streak Will Continue for Calpine (CPN)
Looking for a stock that might be in a good position to beat earnings at its next report? Consider Calpine Corp.CPN , a firm in the Utility-Electric Power industry, which could be a great candidate for another beat.
This company has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. In fact, in these reports, CPN has beaten estimates by at least 15% in both cases, suggesting it has a nice short-term history of crushing expectations.
Earnings in Focus
Two quarters ago, CPN expected to earn 83 cents per share, while it actually produced earnings of 97 cents per share, a beat of 16.9%. Meanwhile, for the most recent quarter, the company looked to deliver a loss of 5 cents per share, when it actually saw earnings of 19 cents per share instead, representing a 480.0% positive surprise.
Thanks in part to this history, recent estimates have been moving higher for Calpine. In fact, the Earnings ESP for CPN is positive, which is a great sign of a coming beat.
After all, the Zacks Earnings ESP compares the most accurate estimate to the broad consensus, looking to find stocks that have seen big revisions as of late, suggesting that analysts have recently become more bullish on the company's earnings prospects. This is the case for CPN, as the firm currently has a Zacks Earnings ESP of 17.86%, so another beat could be around the corner.
This is particularly true when you consider that CPN has a great Zacks Rank #2 (Buy) which can be a harbinger of outperformance and a signal for a strong earnings profile. And when you add this solid Zacks Rank to a positive Earnings ESP, a positive earnings surprise happens nearly 70% of the time, so it seems pretty likely that CPN could see another beat at its next report, especially if recent trends are any guide.
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