Canadian smartphone manufacturer BlackBerry Limited BBRY is expected to release its fourth-quarter 2015 financial numbers before the opening bell on Mar 27.
In the last quarter, the company delivered a positive 116.67% earnings surprise. Meanwhile, in the last four quarters, the company delivered positive earnings surprises, with an average beat of 87.47%.
Let’s see how things are shaping up for this announcement.
Factors at Play
BlackBerry’s BES12 platform is increasingly gaining traction and the company’s latest deal with Sprint also testifies its growing popularity. As per the deal, BlackBerry will deliver secure management solutions to Sprint’s devices from other mobile platforms.
Also, BlackBerry and healthcare data supplier NantHealth recently unveiled the world’s first secure cancer genome browser on BlackBerry’s Passport smartphones for doctors and clinicians.
Despite these positives, weaker smartphone sales, stiff competition, a stagnant product portfolio and an unfavorable product mix continue to act as headwinds for the company.
Earnings Whispers
Our proven model does not conclusively show that BlackBerry is likely to beat the Zacks Consensus Estimate this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or at least 3 for this to happen. That is not the case here, as you will see below:
Zacks ESP: The Earnings ESP represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate. Thus, the ESP for the company is -100% as the Most Accurate estimate is pegged at a loss of 4 cents while the Zacks Consensus Estimate is lower at a loss of 2 cents.
Zacks Rank BlackBerry carries a Zacks Rank #3 (Hold) which increases the predictive power of ESP. However, the company’s -100% ESP makes surprise prediction difficult.
Please note that Sell-rated stocks (#4 and 5) should never be considered going into an earnings announcement.
Stocks to Consider
Here are some companies to consider as our model shows they have the right combination of elements to post an earnings beat this quarter.
Allegiant Travel Company ALGT has an ESP of +1.17% and a Zacks Rank #2 (Buy).
Hawaiian Holdings Inc. HA has an ESP of +5.26% and a Zacks Rank #2.
American Airlines Group Inc. AAL carries a Zacks Rank #3 and an ESP of +0.59%.
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