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What's In Store For Sirius XM Holdings (SIRI) In Q3 Earnings?

Published 10/23/2016, 10:22 PM
Updated 07/09/2023, 06:31 AM

Sirius XM Holdings (NASDAQ:SIRI) is scheduled to report third-quarter 2016 results on Oct 27, before the market opens.

The company missed the Zacks Consensus Estimate in all of the last four quarters. In fact, the company posted a negative earnings estimates of 25% in the last quarter. We wait to see how the company performs this quarter.

Factors at Play

Sirius XM is expected to gain from the growth in net subscriber base. The company expects this figure to increase by 1.6 million in 2016. Moreover, we expect the company’s top line to be benefited by strategic collaborations. The company’s strong telematics partnerships with almost all major car manufacturers deserve special mention in this regard.

However, the company’s high debt levels raises concerns. Increasing competition from peers like Cumulus Media, Inc. (NASDAQ:CMLS) and Entravision Communications (NYSE:EVC) is another headwind.

Earnings Whispers

Our proven model does not conclusively show that Sirius XM 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 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 0.00%. This is because both the Most Accurate estimate and Zacks Consensus Estimate are pegged at 4 cents each.

Zacks Rank: Sirius XM a Zacks Rank #2 which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult.

Please note that we caution against Sell-rated stocks (#4 or 5) going into an earnings announcement.

SIRIUS XM HLDGS Price and EPS Surprise

SIRIUS XM HLDGS Price and EPS Surprise | SIRIUS XM HLDGS Quote

Stock to Consider

Here is a company you may want to consider, as our model shows that it has the right combination of elements to post an earnings beat this quarter:

Nexstar Broadcasting Group (NASDAQ:NXST) , which is scheduled to report third-quarter earnings on Nov 8, has an Earnings ESP of +12.64% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

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SIRIUS XM HLDGS (SIRI): Free Stock Analysis Report

CUMULUS MEDIA (CMLS): Free Stock Analysis Report

NEXSTAR BRDCSTG (NXST): Free Stock Analysis Report

ENTRAVISION COM (EVC): Free Stock Analysis Report

Original post

Zacks Investment Research

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