Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

SunEdison, Inc. (SUNE - Analyst Report) is set to report fourth-quarter 2013 results on Feb 19. Last quarter, the company posted a positive earnings surprise of 100.0%. Let us see how things are shaping up for this announcement.

Growth Factors This Past Quarter

Although SunEdison delivered better-than-expected third-quarter 2013 results, its year-over-year comparisons in every operational metric were down. Solar systems sales were also lower than expected. The fourth-quarter guidance was cautious and fiscal 2013 estimates were lowered.

We believe SunEdison will benefit from the rise in demand for solar energy and the semiconductor business IPO that should further enable it to concentrate on its core competencies. Moreover, its recent partnerships and cost reduction initiatives are expected to enhance SunEdison's margins.  In addition, the company has strengthened its balance sheet and also minimized its annual interest expense that will result in net savings of approximately $35.0 million per year.

Nonetheless, competition from SunPower Corp (SPWR - Analyst Report) and First Solar Inc. (FSLR - Analyst Report) is a concern.

Earnings Whispers?

Our proven model does not conclusively show that SunEdison will beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 12 cents. Hence, the difference is 0.00%.

Zacks Rank: SunEdison’s Zacks Rank #3 (Hold), when combined with a 0.00% ESP makes surprise prediction difficult.

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

Other Stocks to Consider

Here is another 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:

Hewlett-Packard Company (HPQ - Analyst Report) has an Earnings ESP of +1.18% and holds a Zacks Rank #2 (Buy). Hewlett-Packard will report first-quarter 2014 results on Feb 20, 2014.
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%