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Technology has been one of the best-performing sectors in 2017. The Technology SPDR(NYSEARCA:XLK) has returned 9.1% as compared with S&P 500s gain of 5.2% on a year-to-date basis. (Read More: 5 Hottest Tech ETFs of 2017)

The sector is well poised to flourish driven by improving macro-economic conditions in the U.S and global markets. The rebound in U.S. economy, as evident from an improvement in GDP numbers, the Consumer Confidence Index, unemployment rate and factory activity data presents significant growth opportunity for Technology stocks.

Moreover, sector-specific factors like rapid adoption of cloud computing, growing demand for Artificial Intelligence (AI) applications and expanding usage of Internet of Things (IoT) at home, office and car are key catalysts.

The rapid evolution of hybrid cloud (combination of on-premise servers and public cloud servers) is an important factor behind the adoption of cloud computing among enterprises, primarily due to faster data transfer and heightened privacy. Per Gartner Organizations that adopt hybrid infrastructure will optimize costs and increase efficiency.

Per MarketsAndMarkets projections, the hybrid cloud market is estimated to grow at CAGR of 22.5% over 2016-2021 time frame. In dollar terms, the market will grow from $33.28 billion in 2016 to $91.74 billion by 2021.

Meanwhile, demand for AI-based applications has gained immense popularity among enterprises owing to its positive effects on operations. According to Accenture (ACN) AI-based technologies is projected to boost labor productivity by up to 40% by fundamentally changing the way work is done and reinforcing the role of people to drive growth in business.

The advancement in AI tools and related applications like Big Data analytics, Natural Language Processing (NLP), Machine Learning and Deep Learning are primarily responsible for AIs massive growth projections. Per MarketsAndMarkets data, the overall AI market is anticipated to be worth $16.06 Billion by 2022, growing at a CAGR of 62.9% within the 2016- 2022 time frame.

Projections for IoT are also significantly bullish. According to Forbes, which quoted BCG data, spending on IoT technologies, apps and solutions will reach almost $267 billion by 2020.

The technology space continues to be investors favorite owing to its dynamic nature. The improving macro-environment, solid underlying fundamentals and impressive growth opportunities have been primarily responsible for the sectors earnings momentum, which is expected to persist in the first quarter.

According to the latest Earnings Preview, the sectors total earnings are expected to grow 10.7% from the same period last year on 6.2% higher revenues. This is higher than 9.2% earnings growth witnessed in fourth-quarter 2016 on a 5.6% increase in the top line.

With the existence of a number of industry players, finding the right stocks that have the potential to beat earnings could be a daunting task. Our proprietary methodology, however, makes it fairly simple for you. You could narrow down the list of choices by looking at stocks that have the combination of a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP.

Earnings ESP is our proprietary methodology for determining stocks that have the best chance to surprise with their next earnings announcement. It provides the percentage difference between the Most Accurate estimate and the Zacks Consensus Estimate.

Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.

Lets take a look atfour technology providers that have the right combination of elements to post an earnings beat this quarter:

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4 Stocks Set to Trump Earnings in the Technology Space - Investorplace.com