Gartner is projected to post quarterly earnings that are down year over year despite rising revenues. This well recognized consensus view provides a decent idea of the company’s earnings situation, but how actual outcomes compare to these expectations is a major element that might effect its stock price in the short future. Over the last 30 days, the Zacks Consensus Estimate for the quarter has remained unchanged, reflecting how the covering analysts have collectively reassessed their initial estimates. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter, which is a more current version of the Zacks Consensus EPS estimate. The predictive value of the model is significant only for positive ESP readings.
When paired with a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold), the Earnings ESP is a strong predictor of an earnings beat. A negative Earnings ESP number, on the other hand, is not predictive of an earnings miss. The Most Accurate Estimate for Gartner is lower than the Zacks Consensus Estimate, indicating that analysts have lately turned negative on the company’s earnings outlook. Examining the surprise history to determine its impact on the forthcoming number might assist in determining its impact on the future number. Investors should consider other variables before betting on or keeping away from this stock ahead of its earnings announcement.
