Two factors often determine stock prices in the long run: earnings and interest rates. Investors can't control the latter, but they can focus on a company's earnings results every quarter.

We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.

2 Stocks to Add to Your Watchlist

The Zacks Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate. The core of the ESP model is comparing the Most Accurate Estimate to the Zacks Consensus Estimate, where the resulting percentage difference between the two equals the Expected Surprise Prediction.

The last thing we will do today, now that we have a grasp on the ESP and how powerful of a tool it can be, is to look at a qualifying stock. BCE (BCE) holds a Zacks Rank #3 at the moment and its Most Accurate Estimate comes in at $0.53 a share 27 days away from its upcoming earnings release on August 7, 2025.

By taking the percentage difference between the $0.53 Most Accurate Estimate and the $0.51 Zacks Consensus Estimate, BCE has an Earnings ESP of +3.52%.

BCE is part of a big group of Utilities stocks that boast a positive ESP, and investors may want to take a look at Entergy (ETR) as well.

Slated to report earnings on August 7, 2025, Entergy holds a #2 (Buy) ranking on the Zacks Rank, and its Most Accurate Estimate is $1.06 a share 27 days from its next quarterly update.

For Entergy, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $0.83 is +27.42%.

Because both stocks hold a positive Earnings ESP, BCE and ETR could potentially post earnings beats in their next reports.

Find Stocks to Buy or Sell Before They're Reported

Use the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>

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BCE, Inc. (BCE):Free Stock Analysis Report

Entergy Corporation (ETR):Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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