Shares of Viacom (NASDAQ:VIAB) have plummeted 30% over the last year and 8% during the last 12 weeks, as its struggles mount. With that said, Viacom could see its stock price pop if the entertainment company is able to report better-than-expected quarterly earnings results.
Viacom, the owner of BET, MTV, Comedy Central, and Paramount Pictures, has fallen on hard times over the last couple of years as it fails to perform well amid the rapidly changing media landscape. Investors are also likely displeased with the recent back-and-forth between Viacom and CBS (NYSE:CBS) and might be worried that a merger between the two media firms has become less likely.
The current merger talks are unlikely to be resolved before Viacom reports its quarterly earnings results on Wednesday, April 25. Therefore, investors need to take a look at Viacom’s current quarterly estimates to help them understand if an earnings beat might be in store because it could be one of the only ways Viacom impresses in the near-term.
Quarterly Outlook
Viacom’s quarterly revenues are projected to sink by 6.9% to hit $3.03 billion, based on our current Zacks Consensus Estimates. Meanwhile, Viacom’s earnings are expected to climb by 1.3% to reach $0.80 per share.
It is also worth noting that Viacom has earned three earnings estimate revisions, with 100% agreement to the upside, all within the last 30 days. Still, investors need to know a bit more to see if Viacom is actually expected to top its current earnings estimates.
Luckily, Zacks Premium customers can utilize the Earnings ESP Screener in order to search for stocks that are expected to surprise, either way.
This is done because, generally speaking, when an analyst posts an estimate right before an earnings release, it means that they have fresh information which could potentially be more accurate than what analysts thought about a company two or three months ago.
A positive Earnings ESP paired with a Zacks Rank #3 (Hold) or better ranking helps us feel confident about the potential for an earnings beat. In fact, our 10-year backtest has revealed that this methodology has accurately produced a positive surprise 70% of the time.
Viacom is currently a Zacks Rank #2 (Buy) and rocks an Earnings ESP of 0.77%. The company’s Most Accurate Estimate—the representation of the most recent analyst sentiment—calls for earnings of $0.81 per share, which comes in 1 cent above our current consensus estimate.
Therefore, investors should consider Viacom a stock that could beat quarterly earnings estimates when it reports its Q2 financial results before the market opens on Wednesday.
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