Investors are always on the lookout for stocks that are ready to beat in earnings season and Designer Brands Inc.. DBI can be one of these companies. The company has earnings coming very soon, and the events are gearing up pretty well for their report.
Indeed, Designer Brands is seeing favorable earnings estimate revision activity recently, which is usually a precursor to an earnings beat. After all, analysts raising estimates just ahead of earnings — with the most recent information possible — are a pretty good indicator of some favorable trends below the surface for DBI in this report.
In fact, the most accurate estimate for the current quarter is currently 24 cents per share for DBI, compared to a broader Zacks consensus estimate of 23 cents per share. This suggests that analysts have very recently raised their estimates for DBI, giving the stock a Zacks Earnings ESP of +4.35% heading into earnings season.
Designer Brands Inc. Awards and EPS Surprise
Designer Brands Inc. price-eps-surprise | Designer Brands Inc. Quote
Why is this important?
A positive reading for the Zacks Earnings ESP has proven to be very powerful in producing both positive surprises and outperforming the market. Our recent 10-year backtest shows that stocks that have a positive ESP on earnings and a Zacks rank of #3 (Hold) or better show a positive surprise nearly 70% of the time and have returned more than 28% on average in annual returns (see more ESP Top Earnings stocks here).
Given that DBI has a Zacks rank of No. 2 (buy) and an ESP in positive territory, investors might want to consider this stock ahead of earnings. You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Clearly, recent revisions to earnings estimates suggest good things are ahead for designer brands and a beat could be in the cards for the next report.
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Designer Brands Inc. (DBI): Free Inventory Analysis Report
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