Model N, Inc. MODN is scheduled to report third-quarter fiscal 2015 results on Aug 10. Last quarter the company posted a loss per share of 17 cents, narrower than the Zacks Consensus Estimate of a loss of 22 cents.
Let us see how things are shaping up for this announcement.
Factors to Consider
Model N provides revenue management solutions for the life science and technology industries. It develops applications, such as managed care and government pricing for life science companies, and channel incentives based on design wins for technology companies.
We are optimistic about the company’s strategic acquisitions, product launches and deal wins, which should positively impact third-quarter results. However, the pricing pressure caused by stiff competition from SAP SE SAP, I-Many Inc. and Symphony Teleca Corporation may impact profitability in the to-be-reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Model N 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) for this to happen. That is not the case here as you will see below.
Zacks ESP: The Earnings ESP for Model N is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate stand at a loss per share of 20 cents.
Zacks Rank: Model N currently has a Zacks Rank #3 which when combined with 0.00% ESP makes surprise prediction difficult.
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 momentum.
Stocks to Consider
Here are some stocks that you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
eMagin Corp. EMAN, with an Earnings ESP of +100.00% and a Zacks Rank #3.
Magic Software Enterprises Ltd. MGIC, with an Earnings ESP of +8.33% and a Zacks Rank #3.
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