Buy 5 Business Services Stocks Ahead Of Q2 Earnings Next Week

We are in the middle of the coronavirus-stricken second-quarter 2020 earnings season and the results so far are highly disappointing mainly due to the lockdowns.

Coronavirus-induced devastations haven't spared any sector and business services has suffered significantly. Nevertheless, a handful of business services companies are set to beat second-quarter earnings estimates next week.

A Brief Review of Q2

U.S. GDP plunged 32.9% in second-quarter 2020, marking its worst-ever quarterly decline, with the previous nearest low witnessed in the second quarter of 1921. Notably, in the first quarter, the economy declined by 5% year over year.

Economic activities were way below last year in the second quarter since lockdowns continued for nearly two months till the third week of May. Meanwhile, by mid-June, all 50 states reopened their economies in some form or the other.

However, a second wave of COVID-19 in some states since the second half of June forced them to again close some parts of their economies in less than a month. So with businesses mostly remaining closed in the April-June quarter, business services providers suffered.

5 Business Services Stocks Set to Beat on Q2 Earnings

We have narrowed down our search to five business services stocks that are slated to report earnings results next week. Each of these stocks carries a Zacks Rank #2 (Buy) and has a positive Earnings ESP

Our research shows that for stocks with the combination of a Zacks Rank #3 or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are expected to soar after earnings release. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

The chart below shows the price performance of our five picks in the last quarter.

Fiserv Inc. (FISV - Free Report) provides information management systems and services to the financial and insurance industries. Leading services include transaction processing, outsourcing, business process outsourcing, software and systems solutions. The company has an Earnings ESP of +3.14%.

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