Monster Worldwide (MWW) Q1 Earnings: What's In Store?

Monster Worldwide, Inc. (NYSE:MWW) is set to report first-quarter 2016 results on May 5. It delivered a positive earnings surprise of 10.00% in the last quarter. However, it has a negative four-quarter average earnings surprise of 9.79%.

Let’s see how things are shaping up for this announcement.

Factors to Consider

In the last quarter, though Monster Worldwide surpassed earnings estimates, its sales not only missed the same but were also significantly down year over year. Moreover, even the guidance for the first quarter fell short of expectations.

The company has been seeing weakness in its transactions business in key regions like North America and Canada. We expect that going ahead, given an uncertain macroeconomic outlook,, employers might continue to remain conservative with their hiring budget. Further, competition has intensified over the last few years in the online employment market. Many recruiters are already using alternative social media sites such as LinkedIn (NYSE:LNKD) . Though Monster is now working to build its social media presence, the headwinds will likely remain in the near term.

Nonetheless, there can be some respite owing to the re-branding and cost-cutting initiatives that are expected to boost its growth over the long term.

Earnings Whispers

Our proven model does not conclusively show that Monster Worldwide is likely to beat earnings 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. That is not the case here, as you will see below.

Zacks ESP: Monster Worldwide has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 4 cents.

Zacks Rank: Monster Worldwide’s Zacks Rank #3 when combined with a 0.00% ESP makes surprise prediction difficult.

We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Stocks to Consider

Here are some stocks that, as per our model, have the right combination of elements to post an earnings beat this quarter:

Enable Midstream Partners, LP (NYSE:ENBL) has an Earnings ESP of +21.05% and a Zacks Rank #2.

Spectra Energy (NYSE:SE) Partners, LP (NYSE:SEP) has an Earnings ESP of +2.27% and a Zacks Rank #3.