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Will Rogers Communications (RCI) Disappoint Q2 Earnings?
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Rogers Communications Inc. (RCI - Free Report) , the largest integrated telecom operator in Canada, is slated to report its second-quarter 2016 financial numbers before the opening bell on Jul 21.
Last quarter, Rogers Communications posted a negative earnings surprise of 12.50%. However, the company’s earnings have lagged the Zacks Consensus Estimate in three of the previous four quarters, with an average miss of 3.94%. Let’s see how things are shaping up for this announcement.
Rogers Communications operates in a highly competitive wireless market of Canada, where it faces tough competition from market incumbents such as TELUS Corp. (TU - Free Report) and BCE Inc. (BCE - Free Report) and other small regional cable TV operators. Moreover, Shaw Communications’ venture into the Canadian wireless market with the WIND Mobile acquisition increases the competition level for Rogers Communications.
Additionally, Rogers Communications’ Media segment has been affected by continued softness in the advertising market. Hence, to retain its position in the market, the company needs to invest heavily in new TV programs and TV channels which will dent the company’s balance sheet.
Not unlike other cable companies, RogersCommunications, too, has been losing viewers to video streaming service providers like Netflix. In fact, in recent times, viewership of traditional cable TV players has been suffering due to the popularity of on-demand video delivered online.
Nevertheless,the company was the first wireless operator in the nation to offer “Internet of Things” (IoT) as a service to business enterprises. End-to-End Incident Management, Farm & Food Monitoring and Level Monitoring are the three IoT services that the wireless carrier is currently offering to its customers.
Earnings Whispers
Our proven model does not conclusively show that Rogers Communicationsis 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, that is not the case here as elaborated below.
Zacks ESP: Rogers Communications has an earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 64 cents.
Zacks Rank: Rogers Communications has a Zacks Rank #4 (Sell) which increases the predictive power of ESP. However, we need to have a positive ESP to be confident of an earnings surprise.
Another Stock to Consider
Here is another company to consider as our model shows that this also has the right combination of elements to post an earnings beat this quarter
AT&T Inc. (T - Free Report) has an earning ESP of +1.39% and a Zacks Rank #2.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
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Will Rogers Communications (RCI) Disappoint Q2 Earnings?
Rogers Communications Inc. (RCI - Free Report) , the largest integrated telecom operator in Canada, is slated to report its second-quarter 2016 financial numbers before the opening bell on Jul 21.
Last quarter, Rogers Communications posted a negative earnings surprise of 12.50%. However, the company’s earnings have lagged the Zacks Consensus Estimate in three of the previous four quarters, with an average miss of 3.94%. Let’s see how things are shaping up for this announcement.
ROGERS COMM CLB Price and EPS Surprise
ROGERS COMM CLB Price and EPS Surprise | ROGERS COMM CLB Quote
Factors Likely to Influence this Quarter
Rogers Communications operates in a highly competitive wireless market of Canada, where it faces tough competition from market incumbents such as TELUS Corp. (TU - Free Report) and BCE Inc. (BCE - Free Report) and other small regional cable TV operators. Moreover, Shaw Communications’ venture into the Canadian wireless market with the WIND Mobile acquisition increases the competition level for Rogers Communications.
Additionally, Rogers Communications’ Media segment has been affected by continued softness in the advertising market. Hence, to retain its position in the market, the company needs to invest heavily in new TV programs and TV channels which will dent the company’s balance sheet.
Not unlike other cable companies, Rogers Communications, too, has been losing viewers to video streaming service providers like Netflix. In fact, in recent times, viewership of traditional cable TV players has been suffering due to the popularity of on-demand video delivered online.
Nevertheless,the company was the first wireless operator in the nation to offer “Internet of Things” (IoT) as a service to business enterprises. End-to-End Incident Management, Farm & Food Monitoring and Level Monitoring are the three IoT services that the wireless carrier is currently offering to its customers.
Earnings Whispers
Our proven model does not conclusively show that Rogers Communicationsis 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, that is not the case here as elaborated below.
Zacks ESP: Rogers Communications has an earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 64 cents.
Zacks Rank: Rogers Communications has a Zacks Rank #4 (Sell) which increases the predictive power of ESP. However, we need to have a positive ESP to be confident of an earnings surprise.
Another Stock to Consider
Here is another company to consider as our model shows that this also has the right combination of elements to post an earnings beat this quarter
AT&T Inc. (T - Free Report) has an earning ESP of +1.39% and a Zacks Rank #2.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>