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Motorola Solutions, Inc. (MSI - Analyst Report) is slated to report its first-quarter 2014 results before the opening bell on May 1, 2014.

In the last quarter, the company delivered a positive 4.67% earnings surprise. Let’s see how things are shaping up for the company prior to the announcement.

Factors to be Considered This Quarter

Motorola Solutions is the largest developer of public safety products commanding nearly half of the total market share in the U.S. The company is also the largest manufacturer of barcode readers and small rugged mobile computers. Motorola Solutions’ business strategy to focus only on stable government enterprises will help the company maintain its solid performance in the near future.

Motorola Solutions caters to a large set of industries including Transportation & Logistics, Hospitality, Public Safety, Retail, Wholesale Distribution, Oil & Natural Gas, Utilities, to name a few. The company has won several lucrative contracts from various municipalities in the U.S. Outside the U.S., the company is expanding in Europe, the Middle East, Australia, and Latin America.

Continuous contract wins, innovative product launches coupled with the rising popularity of its ASTRO system are likely to spur growth for the company in the coming quarters. However, a sluggish economy, slashed outlook and phasing out of iDEN network may act as headwinds for the company moving ahead.

Earnings Whispers

Our proven model does not conclusively show that Motorola Solutions 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.

Negative Zacks ESP: Earnings ESP represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate. This leads to an ESP of -7.32% for Motorola Solutions as the Most Accurate estimate stands at $0.38 while the Zacks Consensus Estimate is higher at $0.41.

Zacks Rank #4 (Sell): Motorola Solutions’ Zacks Rank #4 decreases the predictive power of ESP.

The Sell-rated stocks (Zacks Rank #4 and 5) should never be considered going into an earnings announcement.

We caution investors against the stock going into the earnings announcement, as an Earnings ESP of -7.32% combined with a Zacks Rank #4 lowers the possibility of an earnings surprise.

Other Stocks to Consider

Here are some companies to consider as our model shows these have the right combination of elements to post an earnings beat this quarter.

America Movil S.A.B. de C.V. (AMX - Analyst Report) with Earnings ESP of +9.76% and Zacks Rank #3.

RigNet, Inc. (RNET - Snapshot Report) with Earnings ESP of +11.11% and Zacks Rank #3.

Charter Communications, Inc. (CHTR - Analyst Report) with Earnings ESP of +40.0% and Zacks Rank #3.

Read the Full Research Report on MSI
Read the Full Research Report on AMX
Read the Full Research Report on CHTR
Read the Full Research Report on RNET


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