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What's in Store for Zillow Group (ZG) this Earnings Season?
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Zillow Group, Inc. (ZG - Free Report) is set to report second-quarter 2016 results on Aug 4. Last quarter, the company posted a negative earnings surprise of 12.5%. Let’s see how things are shaping up for this announcement.
Factors at Play
Zillow offers mobile and web solutions that enable users to find important information about homes. Zillow reported mixed first-quarter fiscal 2016 results. Although the company’s adjusted loss per share was wider than the Zacks Consensus Estimate, its revenues surpassed the same.
We believe that strong traffic growth, frequent product launches and the growing Agent business are positives. In particular, product launches like Zillow Real Estate and Zillow Digs App for Apple Inc.'s (AAPL - Free Report) iPhone and iPad are expected to drive growth.
Moreover, the Trulia acquisition will not only make Zillow the number one online real estate information provider in the U.S., but also help it to compete against Move Inc., which has now been acquired by News Corp.
Zillow also entered into several partnerships with real estate listing companies and real estate brokers to enhance its product portfolio. However, the company is currently in the high investment phase and therefore profitability might be an issue in the to-be reported quarter.
Our proven model does not conclusively show that Zillow is likely to beat the Zacks Consensus Estimate in its upcoming release. 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: The Earnings ESP for Zillow is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at a loss of 19 cents per share.
Zacks Rank: Zillow has a Zacks Rank #2. Though Zacks Rank #1, 2 or 3 increases the predictive power of ESP, the company’s ESP of 0.00% makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Stocks to Consider
Here are some companies, which are worth considering as our model shows that they have the right combination of the two elements needed to post an earnings beat:
Qualys, Inc. (QLYS - Free Report) , with an Earnings ESP of +12.50% and a Zacks Rank #3
CenturyLink, Inc. with an Earnings ESP of +1.70% and a Zacks Rank #3
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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What's in Store for Zillow Group (ZG) this Earnings Season?
Zillow Group, Inc. (ZG - Free Report) is set to report second-quarter 2016 results on Aug 4. Last quarter, the company posted a negative earnings surprise of 12.5%. Let’s see how things are shaping up for this announcement.
Factors at Play
Zillow offers mobile and web solutions that enable users to find important information about homes. Zillow reported mixed first-quarter fiscal 2016 results. Although the company’s adjusted loss per share was wider than the Zacks Consensus Estimate, its revenues surpassed the same.
We believe that strong traffic growth, frequent product launches and the growing Agent business are positives. In particular, product launches like Zillow Real Estate and Zillow Digs App for Apple Inc.'s (AAPL - Free Report) iPhone and iPad are expected to drive growth.
Moreover, the Trulia acquisition will not only make Zillow the number one online real estate information provider in the U.S., but also help it to compete against Move Inc., which has now been acquired by News Corp.
Zillow also entered into several partnerships with real estate listing companies and real estate brokers to enhance its product portfolio. However, the company is currently in the high investment phase and therefore profitability might be an issue in the to-be reported quarter.
ZILLOW GROUP Price and EPS Surprise
ZILLOW GROUP Price and EPS Surprise | ZILLOW GROUP Quote
Earnings Whispers
Our proven model does not conclusively show that Zillow is likely to beat the Zacks Consensus Estimate in its upcoming release. 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: The Earnings ESP for Zillow is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at a loss of 19 cents per share.
Zacks Rank: Zillow has a Zacks Rank #2. Though Zacks Rank #1, 2 or 3 increases the predictive power of ESP, the company’s ESP of 0.00% makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Stocks to Consider
Here are some companies, which are worth considering as our model shows that they have the right combination of the two elements needed to post an earnings beat:
Qualys, Inc. (QLYS - Free Report) , with an Earnings ESP of +12.50% and a Zacks Rank #3
CenturyLink, Inc. with an Earnings ESP of +1.70% and a Zacks Rank #3
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 >>