The overall picture in first-quarter earnings season looks positive for the medical sector. The latest Earnings Trend shows that total earnings for the medical sector companies that have reported till May 3 increased 5.6%. Overall, earnings for the sector are expected to increase from the same period last year on 7.6% higher revenues in the first quarter.The small drugs companies, which are part of the Zacks Medical-Drugs industry, are dependent on their limited portfolio of drugs — approved mostly to treat rare diseases or cancers — or collaborations revenues. These companies develop new therapies using recent technologies like gene therapies targeting diseases with high unmet need.In the first-quarter some of these companies were targeted by large pharma companies to boost their pipeline or marketed portfolio amid multiple challenges including pricing pressure. Some stocks skyrocketed following acquisition deals while several others have gained on buyout speculations in the last few months.Amid recession fears, companies from recession-proof sectors like medical saw significant earnings growth per the report.Key Small Drug ReleasesSeveral companies from the small drug industry reported earlier this week. Some of these companies beat earnings and revenue estimates for the first quarter. These include Jazz Pharmaceuticals JAZZ and Nektar Therapeutics NKTR.How to Pick Potential Winners?By means of the Zacks Stock Screener, we have zeroed in on three drug/biotech stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP. These are valuable tools for investors looking for stocks with high potential to outpace estimates in the impending quarterly results. Moreover, stocks with a top Zacks Rank and a positive ESP have 70% chance to deliver a positive surprise in the ongoing reporting cycle. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.Our PicksCannTrust Holdings Inc. CTST has an Earnings ESP of +6.25% and a Zacks Rank #3. The Zacks Consensus Estimate for first-quarter 2019 stands at a loss of 5 cents. It is scheduled to release financial figures on May 14.You can see the complete list of today’s Zacks #1 Rank stocks here.CannTrust Holdings Inc. Price and EPS Surprise CannTrust Holdings Inc. price-eps-surprise | CannTrust Holdings Inc. QuoteNeon Therapeutics, Inc. NTGN has an Earnings ESP of +17.93% and a Zacks Rank of 3. The Zacks Consensus Estimate for first-quarter 2019 is pegged at a loss of 71 cents.Neon Therapeutics, Inc. Price and EPS Surprise Neon Therapeutics, Inc. price-eps-surprise | Neon Therapeutics, Inc. QuotePolarityTE Inc. PTE has an Earnings ESP of +8.28% and is a Zacks #3 Ranked player. The Zacks Consensus Estimate for first-quarter 2019 is pegged at a loss of 99 cents. The company delivered average trailing four-quarter positive surprise of 5.88%.PolarityTE Inc. Price and EPS Surprise PolarityTE Inc. price-eps-surprise | PolarityTE Inc. QuoteBiggest Tech Breakthrough in a GenerationBe among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.See 7 breakthrough stocks now>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Jazz Pharmaceuticals PLC (JAZZ): Free Stock Analysis Report Nektar Therapeutics (NKTR): Free Stock Analysis Report Majesco Entertainment Company (PTE): Free Stock Analysis Report Neon Therapeutics, Inc. (NTGN): Free Stock Analysis Report CannTrust Holdings Inc. (CTST): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research