Why Federated Hermes (FHI) is Poised to Beat Earnings Estimates Again
This one of the nation's largest managers of money market funds has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for the past two quarters of 14.61%.
For the last reported quarter, Federated Hermes came out with earnings of $1.1 per share versus the Zacks Consensus Estimate of $0.91 per share, representing a surprise of 20.88%. For the previous quarter, the company was expected to post earnings of $0.96 per share and it actually produced earnings of $1.04 per share, delivering a surprise of 8.33%.
Price and EPS Surprise
With this earnings history in mind, recent estimates have been moving higher for Federated Hermes. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the company is positive, which is a great sign of an earnings beat, especially when you combine this metric with its nice Zacks Rank.
Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Federated Hermes currently has an Earnings ESP of +0.68%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #2 (Buy) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on July 31, 2025.
Investors should note, however, that a negative Earnings ESP reading is not indicative of an earnings miss, but a negative value does reduce the predictive power of this metric.
Many companies end up beating the consensus EPS estimate, but that may not be the sole basis for their stocks moving higher. On the other hand, some stocks may hold their ground even if they end up missing the consensus estimate.
Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Federated Hermes, Inc. (FHI) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
6 minutes ago
- Yahoo
Earnings Estimates Moving Higher for Mercury General (MCY): Time to Buy?
Investors might want to bet on Mercury General (MCY), as earnings estimates for this company have been showing solid improvement lately. The stock has already gained solid short-term price momentum, and this trend might continue with its still improving earnings outlook. Analysts' growing optimism on the earnings prospects of this auto insurance company is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight. The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008. For Mercury General, there has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year. The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate: 12 Month EPS Current-Quarter Estimate Revisions The company is expected to earn $2.15 per share for the current quarter, which represents a year-over-year change of -15.4%. The Zacks Consensus Estimate for Mercury General has increased 34.38% over the last 30 days, as one estimate has gone higher compared to no negative revisions. Current-Year Estimate Revisions The company is expected to earn $4.50 per share for the full year, which represents a change of -37.4% from the prior-year number. The revisions trend for the current year also appears quite promising for Mercury General, with one estimate moving higher over the past month compared to no negative revisions. The consensus estimate has also received a boost over this time frame, increasing 1000%. Favorable Zacks Rank Thanks to promising estimate revisions, Mercury General currently carries a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500. Bottom Line While strong estimate revisions for Mercury General have attracted decent investments and pushed the stock 9.7% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Mercury General Corporation (MCY) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
23 minutes ago
- Yahoo
Novavax (NVAX) Q2 Earnings and Revenues Top Estimates
Novavax (NVAX) came out with quarterly earnings of $0.62 per share, beating the Zacks Consensus Estimate of a loss of $0.07 per share. This compares to earnings of $0.99 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +985.71%. A quarter ago, it was expected that this vaccine maker would post earnings of $0.71 per share when it actually produced earnings of $2.93, delivering a surprise of +312.68%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Novavax, which belongs to the Zacks Medical - Biomedical and Genetics industry, posted revenues of $239.24 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 102.74%. This compares to year-ago revenues of $415.48 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Novavax shares have lost about 16.3% since the beginning of the year versus the S&P 500's gain of 7.1%. What's Next for Novavax? While Novavax has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Novavax was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.22 on $107.42 million in revenues for the coming quarter and $2.54 on $1.05 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Biomedical and Genetics is currently in the bottom 42% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. XOMA Royalty (XOMA), another stock in the same industry, has yet to report results for the quarter ended June 2025. This drug developer is expected to post quarterly loss of $0.12 per share in its upcoming report, which represents a year-over-year change of +57.1%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. XOMA Royalty's revenues are expected to be $9.43 million, down 15% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Novavax, Inc. (NVAX) : Free Stock Analysis Report XOMA Royalty Corporation (XOMA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30 minutes ago
- Yahoo
Are Aerospace Stocks Lagging Heico (HEI) This Year?
Investors interested in Aerospace stocks should always be looking to find the best-performing companies in the group. Has Heico Corporation (HEI) been one of those stocks this year? Let's take a closer look at the stock's year-to-date performance to find out. Heico Corporation is a member of the Aerospace sector. This group includes 58 individual stocks and currently holds a Zacks Sector Rank of #5. The Zacks Sector Rank considers 16 different sector groups. The average Zacks Rank of the individual stocks within the groups is measured, and the sectors are listed from best to worst. The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. Heico Corporation is currently sporting a Zacks Rank of #2 (Buy). Over the past three months, the Zacks Consensus Estimate for HEI's full-year earnings has moved 3.4% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving. Our latest available data shows that HEI has returned about 31.7% since the start of the calendar year. At the same time, Aerospace stocks have gained an average of 27.8%. As we can see, Heico Corporation is performing better than its sector in the calendar year. Howmet (HWM) is another Aerospace stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 64%. The consensus estimate for Howmet's current year EPS has increased 3.7% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy). To break things down more, Heico Corporation belongs to the Aerospace - Defense Equipment industry, a group that includes 33 individual companies and currently sits at #144 in the Zacks Industry Rank. On average, stocks in this group have gained 28% this year, meaning that HEI is performing better in terms of year-to-date returns. Howmet, however, belongs to the Aerospace - Defense industry. Currently, this 24-stock industry is ranked #53. The industry has moved +27.8% so far this year. Heico Corporation and Howmet could continue their solid performance, so investors interested in Aerospace stocks should continue to pay close attention to these stocks. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Heico Corporation (HEI) : Free Stock Analysis Report Howmet Aerospace Inc. (HWM) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
