Will Becton Dickinson (BDX) beat estimates again in its next earnings report?

If you’re looking for a stock that has a solid history of beating earnings estimates and is well-positioned to continue the trend in its next quarterly report, you should consider Becton Dickinson (BDX). The company operating in the Zacks Medical – Dental Supplies industry shows potential for another earnings record.

This medical device maker has a strong history of achieving top earnings estimates, especially considering its two previous reports. The company boasts an average surprise of 28.25% for the last two quarters.

For the last reported quarter, Becton Dickinson posted earnings of $4.55 per share versus the Zacks Consensus Estimate of $3.14 per share, representing a surprise of 44.90%. For the prior quarter, the company was expected to post earnings of $2.50 per share and it actually produced earnings of $2.79 per share, delivering a surprise of 11.60%.

For Becton Dickinson, estimates are trending upwards, thanks in part to its history of surprising results. And if you look at the positive Zacks Earnings ESP (Expected Surprise Estimate), it is a great indicator of future earnings growth, especially when combined with the solid Zacks Rank.

Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks in this combination, the number of stocks that beat the consensus could be as high as seven.

The Zacks Earnings ESP compares the Most Accurate Estimates to the Zacks Consensus Estimates for the quarter; The Most Accurate Estimate is the Zacks Consensus version, which is defined in terms of change. The idea is that analysts reviewing their estimates just before an earnings release have the latest information, which could potentially be more accurate than what they and other consensus participants had previously predicted.

Becton Dickinson currently has an Earnings ESP of +1.09%, which suggests analysts have reacted positively to its near-term earnings potential. When you combine this positive Earnings ESP with the stock’s Zacks Rank #3 (Hold), it shows that another rally is likely just around the corner. The company’s next earnings report is expected to be released on May 6, 2021.

For the Earnings ESP metric, remember that a negative value reduces its predictive power; however, a negative earnings ESP does not mean a loss of earnings.

Many companies end up beating consensus EPS estimates, but that may not be the only basis for their stock’s rise. On the other hand, some stocks may hold even if they fall short of the consensus price.

For this reason, it is very important to check a company’s earnings ESP before its quarterly release to increase the chances of success. Use our Earnings ESP filter to find the best stocks to buy or sell before they report.

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