Welcome to our quarterly review of which companies are most likely to beat or miss earnings estimates based on abnormally low or high earnings distortion.
Superior analysis of core earnings, as shown by Harvard Business School (HBS) and MIT Sloan, enables us to identify which firms have the most distortion (i.e. unusual gains/losses) in their numbers. Metrics like “Operating Income After Depreciation” and “Income Before Special Items” [from S&P Global (SPGI)] miss $0.45 out of every $1.00 of earnings distortion found by our Robo-Analyst according to HBS and MIT Sloan.
Every week during the upcoming earnings season, we will publish an Earnings Distortion Scorecard focused on key companies reporting the following week. We segment these companies into five categories:
- Strong Beat
- Strong Miss
These Earnings Distortion Scores are a short-term predictor of the likelihood of a company to miss expectations in the next quarter based on how much their estimates fail to capture unusual gains/losses which cause earnings to be over/understated.
Earnings Season Weekly Reports
Starting the week of October 5, 2020, we’ll break down the important earnings releases for the following week. In this analysis, you’ll get-up-to date information regarding a stock’s expected earnings release date and its Earnings Distortion Score on the likelihood of beating or missing consensus expectations.
This report will be available to Gold and higher members.
Each week, we will focus on the following companies:
Week of 10/5/20: AXP, BAC, BK, BLK, C, CFG, CSX, DOV, ETFC, FAST, FRC, GPC, GS, HON, ISRG, JBHT, JNJ, JPM, KMI, KO, KSU, MS, NVR, OMC, PGR, PLD, PNC, POOL, PPG, SCHW, SLB, SNA, STT, SYF, TEAM, TFC, TXT, UAL, UNH, UNP, USB, WFC.
Week of 10/12/20: AAL, ABT, AEP, AGR, AJG, ALGN, ALK, ALLE, ALXN, AMGN, AMP, AMTD, APH, AVY, BA, BEN, BIIB, BKR, BMRN, BSX, CDNS, CE, CERN, CHTR, CINF, CMA, CMCSA, CMG, COF, COG, CSGP, CTXS, DFS, DGX, DHR, DOW, EBAY, EDU, EFX, ELS, EMN, ESS, EW, FBHS, FCX, FFIV, FTI, FTV, GD, GILD, GL, GWW, HAL, HAS, HBAN, HLT, HSY, IBM, INTC, IPG, ITW, IVZ, KEY, KMB, LH, LII, LMT, LRCX, LUV, LVS, MCD, MHK, MPWR, MSFT, MTB, NDAQ, NEE, NFLX, NOC, NOW, NSC, NUE, ODFL, ORLY, PCAR, PG, PHM, PKG, PM, PNR, PSX, PYPL, RF, RHI, RJF, RMD, ROL, ROP, RTX, SCCO, SIVB, SLG, SNAP, SUI, SWK, T, TAL, TDY, TER, TMO, TROW, TRU, TRV, TSCO, TSLA, TXN, UHS, UPS, V, VAR, VFC, VLO, VRSN, VTR, VZ, WHR, WM, WRB, WST, WY, XEL, XLNX, YNDX, ZION.
Week of 10/19/20: AAPL, ABBV, ABMD, ADM, ADP, AFL, AIG, AIV, AKAM, ALNY, AMD, AME, AMT, AMZN, ANET, ANTM, AON, AOS, APA, APO, APTV, ARE, AVB, AWK, BABA, BAH, BAX, BIO, BLL, BRO, BWA, BXP, CAT, CB, CBOE, CCI, CDW, CGNX, CHD, CHKP, CHRW, CL, CLX, CME, CMI, CMS, CNC, COP, CTSH, CVX, CXO, D, DD, DLR, DRE, ECL, EIX, EPD, EQIX, EQR, ETN, ETR, ETSY, EXAS, EXC, EXR, F, FB, FLS, FRT, FTNT, GE, GLW, GNRC, GOOGL, GPN, GRMN, HBI, HCA, HES, HFC, ICE, IDXX, IEX, INCY, INVH, IP, IPGP, IQV, IR, IRM, IT, JNPR, K, KHC, KKR, KLAC, L, LBRDK, LDOS, LHX, LKQ, LLY, LNC, LNG, LYB, LYV, MA, MAA, MAS, MASI, MCK, MCO, MDLZ, MET, MGM, MKL, MKTX, MLM, MMC, MMM, MO, MOH, MPC, MRK, MSCI, MSI, MXIM, NI, NLY, NOV, NVCR, NWL, NXPI, OKE, PAYC, PEAK, PEG, PFE, PFG, PH, PINS, PKI, PSA, PWR, RCL, RE, REG, SAM, SBUX, SGEN, SHOP, SHW, SIRI, SO, SPG, SPGI, SPOT, SRE, SSNC, STX, SYK, TAP, TDOC, TEL, TFX, TMUS, TRMB, TT, TW, TWLO, TWTR, TYL, UDR, UNM, URI, VRSK, VRTX, W, WAB, WAT, WBA, WDC, WELL, WLTW, WMB, WPC, WU, XOM, XRX, XYL, YUM, YUMC, ZEN.
Week of 10/26/20: ABC, AEE, AES, AIZ, ALB, ALL, ANSS, APD, ATO, ATUS, ATVI, BAP, BDX, BIDU, BKI, BKNG, BMY, BR, CABO, CAH, CBRE, CF, CI, CNP, COTY, CRL, CTLT, CTVA, CVS, DIS, DISH, DUK, DVA, DVN, DXCM, EA, ED, ELAN, EMR, EOG, EPAM, ES, EVRG, EXPD, EXPE, FANG, FE, FICO, FIS, FISV, FLT, FMC, FOXA, GDDY, GH, HIG, HII, HOLX, HSIC, HST, HUBS, HUM, HWM, HZNP, IFF, ILMN, JCI, JKHY, KDP, KIM, LEG, LNT, MAR, MCHP, MNST, MOS, MRO, MTCH, MYL, NBL, NCLH, NEM, NET, NLSN, NRG, NWSA, O, OXY, PCG, PNW, PODD, PPL, PRGO, PRU, PXD, QCOM, QGEN, QRVO, REGN, RNG, ROKU, SBAC, SEE, SQ, STE, SYY, TPR, TTD, UAA, UBER, UI, VMC, VNO, WEC, WRK, WYNN, XRAY, ZBH, ZBRA, ZG.
Week of 11/2/20: NVDA, CSCO, PGR, AMAT, CVNA, DHI, DDOG, ROK, SWKS, TSN, TCOM, WIX, CDAY, CCC, AAP, DXC.
Week of 11/9/20: WMT, HD, LOW, INTU, TGT, TJX, ROST, SPLK, TDG, CPRT, ZTO, LB, GPS, KSS.
See past Earnings Distortion Scorecard reports here.
This article originally published on September 29, 2020.
Disclosure: David Trainer, Kyle Guske II, and Matt Shuler receive no compensation to write about any specific stock, sector, style, or theme.
 Our core earnings are a superior measure of profits, as demonstrated in Core Earnings: New Data & Evidence a paper by professors at Harvard Business School (HBS) & MIT Sloan. The paper empirically shows that our data is superior to “Operating Income After Depreciation” and “Income Before Special Items” from Compustat, owned by S&P Global (SPGI).