Teradata Corporation (TDC) is set to report second quarter 2014 results on Aug 7. Last quarter, it posted a 19.51% positive surprise. The company has posted an average positive earnings surprise of 9.63% over the past four quarters.
Let’s see how things are shaping up for this announcement.
Growth Factors This Past Quarter
We believe that new customer wins and strengthening relationships with large vendors will be the primary revenue drivers, going forward. We also believe Teradata will continue to benefit from its international expansion, improved traction from sales force expansion, new products and alliances, market share gains and a growing database analytics market.
However, increased investment in sales, a sluggish spending environment in the domestic market and increasing competition from EMC Corp. (EMC), NetApp and Fusion-IO are resulting in continued pricing pressure that will likely limit margin expansion, going forward.
Earnings Whispers?
Our proven model does not conclusively show that Teradata is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the case here as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 61 cents. Hence, the difference is of 0.00%.
Zacks Rank #4 (Sell): We caution against stocks with Zacks #4 and #5 Ranks (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
- Super Micro Computer Inc. (SMCI), Earnings ESP of +2.78% and Zacks Rank #1 (Strong Buy)
- Semiconductor Manufacturing International Corp. (SMI), Earnings ESP of +33.33% and Zacks Rank #2 (Buy)
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