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Will Legg Mason (LM) Crush Estimates at Its Next Earnings Report?


Looking for a stock that might be in a good position to beat earnings at its next report? Consider Legg Mason, Inc. LM, a firm in the Financial – Investment Management industry, which could be a great candidate for another beat.

This company has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. In fact, in these reports, LM has beaten estimates by at least 15% in both cases, suggesting it has a nice short-term history of crushing expectations.

Earnings in Focus

Two quarters ago, LM was expected to post 43 cents per share, while it actually produced 66 cents per share, a beat of 53.5%. Meanwhile, for the most recent quarter, the company looked to deliver 68 cents per share, when it actually saw 79 cents per share instead, representing a 16.2% positive surprise.

Legg Mason, Inc. Price and EPS Surprise

Legg Mason, Inc. Price and EPS Surprise | Legg Mason, Inc. Quote

Thanks in part to this history, recent estimates have been moving higher for Legg Mason. In fact, the Earnings ESP for LM is positive, which is a great sign of a coming beat.

After all, the Zacks Earnings ESP compares the most accurate estimate to the broad consensus, looking to find stocks that have seen big revisions as of late, suggesting that analysts have recently become more bullish on the company’s earnings prospects. This is the case for LM, as the firm currently has a Zacks Earnings ESP of 5.43%, so another beat could be around the corner.

This is particularly true when you consider that LM has a great Zacks Rank #1 (Strong Buy), which can be a harbinger of outperformance and a signal for a strong earnings profile. You can see the complete list of today’s Zacks #1 Rank stocks here.

When you add this solid Zacks Rank to a positive Earnings ESP, a positive earnings surprise happens nearly 70% of the time, so it seems pretty likely that LM could see another beat at its next report, especially if recent trends are any guide.

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