DISH Network (DISH) To Report Q1 Earnings: What's In Store?

DISH Network (NASDAQ:DISH) is set to report first-quarter 2018 results on May 8. In the trailing four quarters, the company’s earnings have beaten the Zacks Consensus Estimate on two occasions, delivering an average positive surprise of 0.25%.

In the last-reported quarter, DISH delivered a positive earnings surprise of 1.79%. Revenues of $3.48 billion lagged the Zacks Consensus Estimate of $3.55 billion and decreased 7.2% year over year.

The Zacks Consensus Estimate for first-quarter earnings has remained steady at 72 cents per share over the last seven days, reflecting year-over-year decline of 5.3%. The consensus mark for revenues currently stands at $3.50 billion, reflecting year-over-year decline of almost 5%.

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

Factors to Consider

DISH Network continues to struggle with the persistent loss of subscribers due to stiff competition from rival players like AT&T (NYSE:T), Comcast (NASDAQ:CMCSA) and Charter Communications (NASDAQ:CHTR) as well as cord-cutting in the pay-TV industry.

Moreover, DISH is losing video subscribers to online video streaming providers such as Netflix (NASDAQ:NFLX), Hulu.com, and YouTube among others.

DISH’s top-line growth continues to remain under pressure due to its failure to strike any deal with wireless operators to deploy a nationwide wireless network. Further, escalating programming and content expenses along with retransmission fees is expected to keep margins under pressure.

Nevertheless, DISH’s efforts to diversify its business from being a pure-play satellite-TV operator to an Internet TV operator should help it counter competitive threats from low-cost video streaming operators.

DISH is focusing on providing an improved customer experience. The company has teamed up with Alphabet (NASDAQ:GOOGL) to offer Google Assistant to customers using Hands-Free TV. DISH customers with a Hopper, Joey or Wally can now use voice to control their TV in multiple languages, including English and Spanish.

During the quarter, DISH launched a dual-tuner HD set-top solution for one and two-TV households called Hopper Duo. The device is compatible with Amazon (NASDAQ:AMZN) Alexa and offers apps like Game Finder, Pandora and DISH On-Demand.

Moreover, the company continues to look for wireless opportunities with its extensive portfolio of wireless spectrum, valued at around $50 billion. Further, the launch of the mobile app, DISH Music bodes well.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.

We believe that DISH is likely to deliver a positive earnings surprise in the first quarter due to a favorable combination of a Zacks Rank #3 and an Earnings ESP of +0.07%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks That Warrant a Look

Here are couple of stocks that you may want to consider as our model shows these too have the right combination of elements to deliver an earnings beat in its upcoming release.

Microchip (NASDAQ:MCHP) has an Earnings ESP of +0.15% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Arrow Electronics (NYSE:ARW) has an Earnings ESP of +0.66% and a Zacks Rank #2.

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