Should investors worry about GWH's EPS surprises?

**Investors should not necessarily worry about GWH's EPS surprises alone**, as the context of these surprises is crucial for a comprehensive understanding. Here's an analysis of the factors contributing to ESS Tech's (GWH) EPS:

1. **Understanding the EPS Surprise**: The most recent EPS surprise was a quarterly loss of $1.97 per share, which was worse than the Zacks Consensus Estimate of a loss of $1.51 per share. This represents a significant negative surprise, indicating that the company's actual performance was significantly worse than expected.

2. **Recurring Nature of Losses**: The company has experienced a net loss of $86.2 million for the fiscal year ended December 31, 2024, with a net loss of $77.6 million in the previous year. This suggests a pattern of recurring losses, which could be a cause for concern for investors.
3. **Transition to Commercial Inventory Accounting**: ESS Tech's transition to commercial inventory accounting in the third quarter of 2023 has impacted its cost of revenue and research and development expenses. This transition has resulted in a significant increase in cost of revenue, which may be contributing to the company's losses.
4. **Strategic Initiatives**: The company is focusing on new products and expects growth in late 2025, with plans to raise capital by Q2 2025. This strategic focus on growth opportunities could be a positive sign, indicating that the company is working on improving its financial performance.
5. **Analyst Forecasts**: Analysts have provided a mixed forecast, with a significant potential upside from the current stock price. The average target price set by five analysts stands at $7.70, indicating a potential upside of 136.20% from the current trading price of $3.26.

In conclusion, while the negative EPS surprise is concerning, investors should also consider the company's strategic initiatives and growth prospects. The transition to commercial inventory accounting and the need for additional financing are factors to monitor closely. The mixed analyst forecasts suggest that while there is potential upside, investors should remain cautious and keep an eye on the company's strategic progress and financial performance.