by Tajinder Dhillon.
In February 2019 we published our top ten Asia fiscal year 2018 earnings surprise candidates based on StarMine predictive analytics models. Of these FY18 Asia earnings surprise candidates picks, 70% were correct.
The StarMine SmartEstimate® is a weighted average of analyst estimates, with more weight given to more recent estimates and more accurate analysts. Our studies have shown that when the SmartEstimate® differs significantly from the consensus (IBES Mean), the Predicted Surprise accurately predicts the direction of earnings surprises or further revisions 70% of the time. When significant Predicted Surprise for revenue is also present for the period, the accuracy improves to 78%.
Using SmartEstimate® and Predicted Surprise data, we highlighted 10 companies with a high probability of reporting Full-Year earnings surprises in the direction we called — five likely to beat the analysts’ consensus estimate and another five likely to fall short.