Cinemark Holdings, Inc. CNK isslated to release its third-quarter 2015 results on Nov 5, before market opens.
Last quarter, Cinemark delivered a negative earnings surprise of 1.59%. However, the company’s earnings have surpassed the Zacks Consensus Estimate in two of the past four quarters, with an average beat of 4.93%. Let’s see how things are shaping up for this announcement.
Factors Likely to Influence this Quarter
The company recently opened a new 14-screen theater in North Haven, CT with state-of-the-art amenities. The company has been adding as well as renovating theaters with special features to rake in ancillary revenues from movie goers through beverages and foods.
However, theater chains are constantly facing threat from alternative movie streaming services such as Netflix Inc. NFLX, and Time Warner’s TWX HBO Now and Hulu. While theater chains still remain the preferred choice for film studios, the recent trend of movie watchers opting for streaming services are making film studios seek better terms in box office revenues with large-screen theater companies.
Earnings Whispers
Our proven model does not conclusively show that Cinemark is likely to beat the Zacks Consensus Estimate this quarter. This 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. Unfortunately, that is not the case here as elaborated below:
Zacks ESP: Cinemark has an earnings ESP of 0.00%. This is because both the Zacks Consensus Estimate and the Most Accurate estimate are pegged at 43 cents.
Zacks Rank: Cinemark has a Zacks Rank #3 which increases the predictive power of ESP. However, we need to have a positive ESP to be confident of an earnings surprise.
A Stock to Consider
Here is a company you may want to consider as our model shows it has the right combination of elements to post an earnings beat this quarter:
Live Nation Entertainment, Inc. LYV, which has an earnings ESP of +1 .11% and a Zacks Rank #3.
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