3 Top-Rated Stocks to Consider as Earnings Approach

Rounding out this week’s earnings lineup several top-rated Zacks stocks will be releasing their quarterly results on Friday, July 21.

These particular stocks belong to strong business industries and here is a look at why they are worthy of investors’ consideration at the moment.

World Acceptance (WRLD)

Starting out of the Zacks Finance sector is World Acceptance which stock currently covets a Zacks Rank #1 (Strong Buy). Plus, World Acceptance’s Zacks Financial-Consumer Loans Industry is in the top 10% of over 250 Zacks industries.

World Acceptance is engaged in the small-loan consumer finance business and there is much optimism about the company’s fiscal first-quarter earnings tomorrow. Anticipation is high after World Acceptance most recently blasted its Q4 earnings expectations by 32% in May with EPS at $1.97 compared to estimates of $1.49 a share.

This sent shares of WRLD soaring which have now skyrocketed +109% this year to largely outperform the broader indexes and the Finance-Consumer Loans Markets’ +29%.

Although first-quarter earnings are expected to be down -2% from a year ago at $1.13 per share, there would be little surprise if World Acceptance was able to surpass estimates again. World Acceptance should continue to thrive from its vibrant business environment as a provider of short-term loans, medium-term larger loans, credit insurance, and ancillary products.

Furthermore, annual earnings are now forecasted to skyrocket 213% at $11.26 per share compared to EPS of $3.60 in 2022. World Acceptance stock is definitely one to watch with shares still trading reasonably at $136 and 12.4X forward earnings.

Despite this year’s very impressive rally World Acceptance stock still trades attractively beneath the S&P 500’s 21.4X and closer to its industry average of 7.9X. Even better, shares of WRLD still trade well below their decade-long high of 30.2X and roughly on par with the median of 11.8X.

AutoNation (AN)

Sporting a Zacks Rank #2 (Buy), AutoNation is another stock investors may want to consider at the moment with its Automotive-Retail and Whole Sales Industry in Zacks top 16%.

In correlation with its favorable industry outlook, AutoNation is naturally expected to reap the rewards as the largest automotive retailer in the United States. Already coming off of a record year that saw earnings at $24.57 per share, AutoNation’s bottom line is expected to dip-10% in fiscal 2023 but remains robust.

Plus, earnings estimate revisions have continued to rise leading up to AutoNation’s second-quarter report. Over the last quarter, earnings estimates have now risen 5% for Q2 with annual EPS estimates rising 5% for FY23 and up 3% for FY24.

More intriguing, the Zacks Expected Surprise Prediction (ESP) indicates AutoNation could top its Q2 earnings expectations with the Most Accurate Estimate having EPS at $6.01 and 3% above the Zacks Consensus of $5.80 per share.

The cherry on top is that AutoNation stock has soared 65% YTD but still trades very attractively at $176 a share and just 8.4X forward earnings. This is well below the benchmark’s forward looking P/E and near its industry average of 7.9X.

Roper Technologies (ROP)

Lastly, investors may want to consider Roper Technologies stock which currently sports a Zacks Rank #2 (Buy) with its Computers-IT Services Industry in Zacks top 43%.

Roper is a tech stock that could still have an abundance of upside this year as a provider of engineered products, software, and solutions to a variety of end markets. Shares of ROP currently trade at $481 and are up a respectable +11% YTD with rising earnings estimates offering furhter support.

Solid quarterly growth is expected with Roper’s Q2 earnings projected to be up 1% YoY at $4.00 a share and sales forecasted to climb 14% to $1.50 billion. What is most intriguing is that annual earnings are now anticipated to jump 14% this year at $16.25 per share compared to EPS of $14.28 in 2022.

Better still, FY24 earnings are projected to rise another 6%. Fiscal 2024 EPS projections of $17.33 per share would represent 36% growth over the last five years with earnings at $12.74 a share in 2020.

Bottom Line

World Acceptance, AutoNation, and Roper Technologies stock look very attractive ahead of their quarterly reports tomorrow. Now appears to be a good time to buy as these stocks are poised to keep rising as we progress through 2023.

World Acceptance Corporation (WRLD): Free Stock Analysis Report

Roper Technologies, Inc. (ROP): Free Stock Analysis Report

AutoNation, Inc. (AN): Free Stock Analysis Report

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