Will Avient (AVNT) Beat Estimates Again in Its Next Earnings Report?

Have you been looking for a stock that might be well-positioned to continue its earnings streak in its upcoming report? Consider Avient (AVNT), which belongs to the Zacks Chemical – Diversified industry.

Looking at the last two reports, this producer of resins used in plastic pipes and other products has had a strong streak of beating earnings estimates. The company has beaten estimates by an average of 10.39% over the last two quarters.

For the last reported quarter, Avient showed earnings of $0.76 per share, compared to the Zacks consensus estimate of $0.69 per share, representing a surprise of 10.14%. In the previous quarter, the company was expected to show earnings of $0.47 per share, but actually showed earnings of $0.52 per share, representing a surprise of 10.64%.

Price and EPS are surprising

In the case of Avient, estimates are higher, thanks in part to this earnings surprise history. And when you look at the stock’s positive Zacks Earnings ESP (Expected Surprise Prediction), it’s a great indicator of future earnings beats, especially when paired with its solid Zacks Rank.

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

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a revision of the Zacks Consensus definition that is related to revision. The idea is that the analysts revising their estimates just before an earnings release have the latest information, which could potentially be more accurate than what they and other contributors to the consensus had previously predicted.

Avient currently has an Earnings ESP of +1.09%, suggesting that analysts have become bullish on the near-term earnings potential. When we combine this positive Earnings ESP with the stock’s Zacks Rank #3 (Hold), it shows that another beat is likely just around the corner.

In the case of the Earnings ESP indicator, it is important to remember that a negative value reduces its predictive power; however, it is important to remember that a negative Earnings ESP does not indicate a divergence in earnings.

Many companies end up beating consensus EPS estimates, although that’s not the only reason their stocks appreciate. In addition, some stocks can remain stable even if they end up missing consensus estimates.

For this reason, it is very important to check a company’s Earnings ESP before its quarterly release to increase your chances of success. Make sure you use our Earnings ESP Filter to discover the best stocks to buy or sell before they are released.

Zacks Gives ‘Best Single Pick to Double Down’

From thousands of stocks, 5 Zacks experts have selected their favorites to grow +100% or more in the coming months. Of these 5, Director of Research Sheraz Mian personally selects one that has the most explosive growth potential of them all.

It’s a little-known chemical company that’s up 65% from a year ago, yet it’s still very cheap. With continued demand, rising earnings estimates for 2022, and $1.5 billion in share buybacks, retail investors could jump in at any moment.

This stock could compete with or outperform other Zacks stocks that have doubled recently, such as Boston Beer Company, which is up 143.0% in just over 9 months, and NVIDIA, which is up 175.9% over a year.

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Avient Corporation (AVNT): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.