AVEO Pharmaceuticals, Inc. AVEO is expected to report first-quarter 2016 results on Mar 5.AVEO has an impressive track record. The company has beaten estimates in all the four trailing quarters, with an average positive earnings surprise of 70.29%. Last quarter, it posted a positive earnings surprise of 21.43%.Let’s see how things are shaping up for the first quarter of 2016.Factors at PlayAVEO, a development-stage biopharmaceutical company, utilizes its proprietary human response platform for developing treatments targeting cancer. The company’s most advanced candidate, tivozanib, is being developed for the treatment of renal cell carcinoma (RCC) (phase III) and metastatic colorectal cancer (phase II).In the to-be-reported quarter, AVEO along with its partner EUSA Pharma, announced the submission of a marketing authorization application to the European Medicines Agency for tivozanib for the first-line treatment of advanced RCC. AVEO has an exclusive license agreement with EUSA Pharma, which grants the latter the rights to tivozanib in Europe for the treatment of advanced RCC. The agreement covers a number of additional territories outside North America, including South America and South Africa, and additional potential indications. Moreover, AVEO has agreements with Ophthotech Corporation OPHT Pharmstandard Group for tivozanib. Meanwhile, a registration dossier seeking marketing authorization of tivozanib as a first-line treatment of advanced RCC is currently under review in Russia. Other candidates in the company’s pipeline include ficlatuzumab (phase II – non-small cell lung cancer) and AV-203 (phase I completed –advanced solid tumors). The company has an agreement with Novartis AG NVS for the development and commercialization of AV-380, and Biodesix, Inc. for the development and commercialization of ficlatuzumab with Biodesix’s companion diagnostic test, VeriStrat.With no approved product in AVEO’s portfolio at the moment, the company depends entirely on collaboration revenues and milestone payments for its top line. We believe the company will continue to record revenues from these sources in the first quarter of 2016 as well.On the first-quarter call, we expect investor focus to remain on tivozanib’s progress and other pipeline-related updates.What Our Model IndicatesOur proven model does not conclusively show that AVEO is likely to beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) to be able to surpass estimates. That is not the case here as you will see below.Zacks ESP: The Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is 0.00%, since the Most Accurate estimate is in line with the Zacks Consensus Estimate of a loss of 13 cents.Zacks Rank: AVEO currently has a Zacks Rank #3. Although this enhances the predictive power of the ESP, the company’s ESP of 0.00% makes surprise prediction difficult.Note that we caution against stocks with a Zacks Rank #4 or #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.Stock to ConsiderHere is a health care stock that you may want to consider, as our model shows that it has the right combination of elements to post an earnings beat this quarter.The Earnings ESP for Zoetis Inc. ZTS is +2.44% and it carries a Zacks Rank #3. The company is scheduled to release results on May 4. 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 >>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 NOVARTIS AG-ADR (NVS): Free Stock Analysis Report AVEO PHARMACEUT (AVEO): Free Stock Analysis Report OPHTHOTECH CORP (OPHT): Free Stock Analysis Report ZOETIS INC (ZTS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research