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Will Chemours (CC) 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 the next quarterly report, you should consider Chemours (CC). This stock, which belongs to the Zacks Chemical – Diversified industry, shows potential for another earnings beat.

This chemical company has a strong history of achieving top earnings estimates, especially considering its two previous reports. The company boasts an average surprise for the last two quarters of 19.62%.

For the last reported quarter, Chemours posted earnings of $1.20 per share versus the Zacks Consensus Estimate of $0.89 per share, representing a surprise of 34.83%. For the previous quarter, it was expected that the company would post earnings of $0.68 per share and it actually produced earnings of $0.71 per share, delivering a surprise of 4.41%.

Price and EPS surprise

With this earnings history in mind, Chemours’ latest estimates are getting higher. In fact, the company’s Zacks Earnings ESP (expected surprise) is positive, which is a great sign of earnings growth, especially when you combine this metric with a nice 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.

Chemours currently has an Earnings ESP of +5.70%, which suggests analysts have recently become optimistic about the company’s earnings prospects. This positive Earnings ESP combined with the stock’s Zacks Rank #2 (Buy) indicates that another rally is likely just around the corner. We expect the company’s next earnings report to be published on November 4, 2021.

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, 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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