Comcast Corporation (CMCSA) is set to release its fourth-quarter fiscal 2013 results before the opening bell on Jan 28, 2014.
In the last quarter, the company delivered a 8.33% earnings surprise. Let’s see how things are shaping up for this announcement.
Factors to be Considered this Quarter
Comcast’s Cable businesses continued performing well and the NBC Universal segment is witnessing improvement. As a result, Comcast generated a record-high free cash flow. The company completed its major technical innovations such as DOCSIS 3.0, all digital networks and a multi-platform content delivery network. Moreover, newly-launched services such as Xfinity Home, Wi-Fi, Streampix, X1, upcoming X2 and the high-speed Metro Ethernet are the several long-term growth catalysts for the company. On the other hand, continued loss of video customers is a concern. The cable TV operators are gradually losing their hold in the U.S. pay-TV market.
Earnings Whispers
Our proven model does not conclusively show that Comcast 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, this is not the case here as elaborated below.
Zacks ESP: This is because the Most Accurate estimate is poised at 67 cents while the Zacks Consensus Estimate is 68 cents. This leads to an ESP of -1.47% for Comcast.
Zacks Rank #3 (Hold): Comcast’s Zacks Rank #3 decreases the predictive power of ESP.
We caution investors against the stock going into the earnings announcement, as a Zacks Earnings ESP of 0.00% combined with a Zacks Rank #3 lowers the possibility of an earnings surprise.
Other Stocks to Consider
Here are some other companies to consider as our model shows they have the right combination of elements to post an earnings beat this quarter.
TiVo Inc. (TIVO) has Earnings ESP of +33.33% and carries a Zacks Rank #3.
Shaw Communications Inc. (SJR) has Earnings ESP of +2.63% and carries a Zacks Rank #3.
Frontier Communications Corporation (FTR) has Earnings ESP of +16.67% and carries a Zacks Rank #3 (Hold).
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