Want Better Returns? Don't Ignore These 2 Consumer Staples Stocks Set to Beat Earnings

Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.Life and the stock market are both about expectations, and rising above what is expected is often rewarded, while falling short can come with negative consequences. Investors might want to try to capture stronger returns by finding positive earnings surprises.Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.The Zacks Earnings ESP, ExplainedThe Zacks Earnings ESP is more formally known as the Expected Surprise Prediction, and it aims to grab the inside track on the latest analyst estimate revisions ahead of a company's report. The idea is relatively intuitive as a newer projection might be based on more complete information.The core of the ESP model is comparing the Most Accurate Estimate to the Zacks Consensus Estimate, where the resulting percentage difference between the two equals the Expected Surprise Prediction. The Zacks Rank is also factored into the ESP metric to better help find companies that appear poised to top their next bottom-line consensus estimate, which will hopefully help lift the stock price.In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.Should You Consider Colgate-Palmolive?Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. Colgate-Palmolive (CL) earns a #3 (Hold) right now and its Most Accurate Estimate sits at $0.96 a share, just 30 days from its upcoming earnings release on July 31, 2026.By taking the percentage difference between the $0.96 Most Accurate Estimate and the $0.95 Zacks Consensus Estimate, Colgate-Palmolive has an Earnings ESP of +0.78%. Investors should also know that CL is one of a large group of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.CL is part of a big group of Consumer Staples stocks that boast a positive ESP, and investors may want to take a look at Mondelez (MDLZ) as well.Slated to report earnings on August 4, 2026, Mondelez holds a #3 (Hold) ranking on the Zacks Rank, and its Most Accurate Estimate is $0.68 a share 34 days from its next quarterly update.The Zacks Consensus Estimate for Mondelez is $0.67, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +1.52%.CL and MDLZ's positive ESP figures tell us that both stocks have a good chance at beating analyst expectations in their next earnings report.Find Stocks to Buy or Sell Before They're ReportedUse the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>Should You Invest in Colgate-Palmolive Company (CL)?Before you invest in Colgate-Palmolive Company (CL), want to know the best stocks to buy for the next 30 days? Check out Zacks Investment Research for our free report on the 7 best stocks to buy.Zacks Investment Research has been committed to providing investors with tools and independent research since 1978. For more than a quarter century, the Zacks Rank stock-rating system has more than doubled the S&P 500 with an average gain of +24.08% per year. (These returns cover a period from January 1, 1988 through May 6, 2024.)This article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks