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Will Viacom (VIAB) Disappoint Earnings Estimates in Q3? - Analyst Blog

Viacom Inc. VIAB is set to release third-quarter 2015 results before the opening bell on Aug 6.

In the last quarter, the company posted a 7.41% earnings surprise. Let’s see how things are shaping up for this announcement.

Factors at Play

Lack of popular movie releases is likely to hurt the company’s Film segment. In addition, an enhanced geographic presence will increase the foreign currency exchange rate risks for Viacom. Moreover, mounting programming expenses may further impact margins while moving ahead.

Earnings Whispers

Our proven model does not conclusively show that Viacom 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 at least 3 (Hold) for this to happen. Unfortunately, this is not the case here as elaborated below.

Zacks ESP: The Earnings ESP for the company currently stands at -1.35% as the Most Accurate estimate is pegged at $1.46 while the Zacks Consensus Estimate is higher at $1.48.


Zacks Rank: Viacom carries a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s negative 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 you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter.

Ashford Hospitality Trust, Inc. AHT has an earnings ESP of +4.35% and a Zacks Rank #1.

Sprint Corporation S has an earnings ESP of +25.0% and a Zacks Rank #3.

The Walt Disney Company DIS has an earnings ESP of +2.16% and a Zacks Rank #3.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
SPRINT CORP (S): Free Stock Analysis Report
 
DISNEY WALT (DIS): Free Stock Analysis Report
 
ASHFORD HOSPTLY (AHT): Free Stock Analysis Report
 
VIACOM INC-B (VIAB): Free Stock Analysis Report
 
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Zacks Investment Research