Why Investors Need to Take Advantage of These 2 Finance Stocks Now

Earnings are arguably the most important single number on a company's quarterly financial report. Wall Street clearly dives into all of the other metrics and management's input, but the EPS figure helps cut through all the noise.

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, Explained

The 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.

Stocks with a ranking of #3 (Hold), or 60% of all stocks covered by the Zacks Rank, are expected to perform in-line with the broader market. Stocks with rankings of #2 (Buy) and #1 (Strong Buy), or the top 15% and top 5% of stocks, respectively, should outperform the market; Strong Buy stocks should outperform more than any other rank.

Should You Consider Progressive?

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. Progressive (PGR) earns a #3 (Hold) right now and its Most Accurate Estimate sits at $4.72 a share, just 30 days from its upcoming earnings release on April 15, 2026.

Progressive's Earnings ESP sits at +0.52%, which, as explained above, is calculated by taking the percentage difference between the $4.72 Most Accurate Estimate and the Zacks Consensus Estimate of $4.69. PGR is also part of a large group of stocks that boast a positive ESP. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

PGR is just one of a large group of Finance stocks with a positive ESP figure. Skyward Specialty Insurance (SKWD) is another qualifying stock you may want to consider.

Slated to report earnings on May 7, 2026, Skyward Specialty Insurance holds a #2 (Buy) ranking on the Zacks Rank, and its Most Accurate Estimate is $1.05 a share 52 days from its next quarterly update.

For Skyward Specialty Insurance, the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $1.04 is +0.58%.

PGR and SKWD'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 Reported

Use 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 The Progressive Corporation (PGR)?

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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.)

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The Progressive Corporation (PGR): Free Stock Analysis Report

Skyward Specialty Insurance Group, Inc. (SKWD): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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