Looking for a stock that might be in a good position to beat earnings at its next report? Consider Shake Shack Inc. (SHAK), a firm in the Retail – Restaurants space, 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, SHAK has beaten estimates by at least 65% in both cases, suggesting it has a nice short-term history of crushing expectations.
Earnings in Focus
Two quarters ago, SHAK expected to incur a loss of 3 cents per share, while it actually incurred a loss of 1 cent per share, a beat of 66.7%. Meanwhile, for the most recent quarter, the company looked to deliver a loss of 3 cents per share, when it actually saw earnings of 4 cents per share instead, representing a positive surprise of over 100%.
Thanks in part to this history, recent estimates have been moving higher for Shake Shack. In fact, the Earnings ESP for SHAK 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 SHAK, as the firm currently has a Zacks Earnings ESP of 33.33%, so another beat could be around the corner.
This is particularly true when you consider that SHAK 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 SHAK could see another beat at its next report, especially if recent trends are any guide.
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