Will Applied Industrial Technologies (AIT) 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 Applied Industrial Technologies (AIT). This stock, which belongs to the Zacks Manufacturing – General Industrial industry, shows potential for another earnings beat.

This industrial products company has a strong history of achieving top earnings estimates, especially considering its two previous reports. The company boasts an average surprise of 20% for the last two quarters.

Applied Industrial Technologies was expected to post earnings of $1.71 per share for the most recent quarter, but instead reported earnings of $2.05 per share, representing a surprise of 19.88%. The consensus estimate for the prior quarter was $1.64 per share when it actually delivered $1.97 per share, representing a surprise of 20.12%.

Price and EPS surprise

For Applied Industrial Technologies, 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 that could potentially be more accurate than what they and other consensus participants had previously predicted.

Currently, the ESP for Applied Industrial Technologies is +3.30%, which suggests that analysts are optimistic about 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 April 27, 2023.

However, investors should remember that a negative earnings ESP reading does not mean a loss of earnings, but a negative value reduces the predictive power of the metric.

Many companies end up beating consensus EPS estimates, though that’s not the only reason their shares rise. Additionally, some stocks may remain stable even if they fall short of consensus estimates.

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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Applied Industrial Technologies, Inc. (AIT): Free Inventory Analysis Report

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