Core Viewpoint - Ambac Financial Group (AMBC) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Ratings - The Zacks rating system is based solely on a company's changing earnings picture, tracking the Zacks Consensus Estimate for EPS from sell-side analysts [2]. - The Zacks rating upgrade for Ambac reflects an improved earnings outlook, which is expected to positively impact its stock price [3][5]. Impact of Earnings Estimate Revisions - There is a strong correlation between earnings estimate revisions and near-term stock price movements, making the Zacks rating system valuable for investors [4][6]. - Rising earnings estimates for Ambac indicate an improvement in the company's underlying business, likely leading to higher stock prices [5]. Performance of Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - Ambac's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10]. Current Earnings Estimates for Ambac - Ambac is expected to earn -$0.65 per share for the fiscal year ending December 2025, with no year-over-year change, but the Zacks Consensus Estimate has increased by 3.7% over the past three months [8]. Zacks Rating System Characteristics - The Zacks rating system maintains a balanced proportion of "buy" and "sell" ratings across its universe of over 4,000 stocks, with only the top 5% receiving a "Strong Buy" rating [9].