What's In Store For Dun & Bradstreet (DNB) In Q3 Earnings?

The Dun & Bradstreet Corporation (NYSE:DNB) is set to release third-quarter 2016 earnings results on Nov 1. In the last quarter, the company reported a positive earnings surprise of 16.10%. Notably, the company delivered positive earnings surprises in the last four quarters, with an average of 13.13%.

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

Factors to Consider

Dun & Bradstreet delivered decent results in the second-quarter of 2016, with both revenues and earnings surpassing the Zacks Consensus Estimate comfortably. Also, on a year-over-year basis, both the top line and the bottom line registered modest growth.

We believe that Dun & Bradstreet’s high-margin business model, strategic investments, partnerships, accretive cloud-based acquisitions and aggressive share buyback will drive growth.

Also, the company will be able to provide a wide range of products, given its partnerships with the likes of Salesforce.com (NYSE:CRM) , Oracle Corp (NYSE:ORCL)., SugarCRM, Salesforce Wave analytics platform and Lattice Engines, which in turn will drive its top line.

However, increasing competition from companies such as FactSet Research Systems Inc. and Nielsen N.V. will continue to hurt revenues and profitability in the near term. Moreover, a high debt level remains a concern for the to-be reported quarter.

Earnings Whispers?

Our proven model does not conclusively show that Dun & Bradstreet 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: Dun & Bradstreet’s Earnings ESP is -1.71%. This is because the Most Accurate estimate stands at $1.72 while the Zacks Consensus Estimate is pegged at $1.75 per share. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.

Zacks Rank: Dun & Bradstreet carries a Zacks Rank #3 , which increases the predictive power of ESP. However, we need to have a positive ESP to be confident about an earnings surprise.

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

Stocks to Consider

Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

Inovalon Holdings, Inc. (NASDAQ:INOV) with an Earnings ESP of +50.00% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

SITO Mobile, Ltd. (NASDAQ:SITO) with an Earnings ESP of +100.00% and a Zacks Rank #1

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