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Cincinnati Bell (CBB) Q3 Earnings: A Beat in the Cards?
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Telecom service provider Cincinnati Bell Inc. is slated to report third-quarter 2016 results on Nov 2, before the opening bell.
Last quarter, the company posted a negative earnings surprise of 50.00%. Moreover, the company’s earnings lagged the Zacks Consensus Estimate in two of the previous four quarters, the average miss being 16.67%. Let’s see how things are shaping up for this announcement.
Why a Likely Positive Surprise?
Our proven model shows that Cincinnati Bellis likely to beat estimates because it has the right combination of two key elements.
Zacks ESP: Cincinnati Bell has an Earnings ESP of +20.00%. This is because the Most Accurate estimate is pegged at 6 cents while the Zacks Consensus Estimate is lower at 5 cents. This is a meaningful and leading indicator of a likely positive earnings surprise. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
Zacks Rank: Cincinnati Bell has a Zacks Rank #3 (Hold). Note that stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating estimates. Conversely, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
What is Driving the Better-than-Expected Earnings?
Cincinnati Bell is focused on transforming itself from a legacy copper-based telecommunications company into a technology firm offering flexible data, video, voice and IP solutions to both consumer and business customers. In the Entertainment and Communications business, the company’s investments in Fioptics products, which provide entertainment, high-speed Internet and traditional voice via fiber line to homes, are on the rise. Recently, the company signed a deal with The E.W. Scripps Company, an American broadcasting company based in Cincinnati. Per the deal, Scripps’ wholly owned subsidiary Newsy – a digital video news channel – will now be available on Cincinnati Bell’s Fioptics lineup of HD channels. Newsy is accessible on devices such as Apple’s Apple TV, Dish Network Corp.’s Sling TV, Roku, Amazon.com Inc.’s (AMZN - Free Report) Fire TV and Google’s Chromecast.
Additionally, increased investments in strategic products are expected to open up ample opportunities for enterprise customers, thus boosting Cincinnati Bell’s revenues and profits. Creation of a new business division for supporting small and mid-sized businesses and development of its IT Services and Hardware division should rake in more profits.
On the flip side, continuous erosion in local access lines, heavy capital expenditure requirements and legal hurdles raise caution. Moreover, intensifying competition in the company’s operational region can prove to be a drag on its pricing power, thereby inducing pressure on margins.
Cincinnati Bell is not the only company looking up this earnings season. Here is a company that has the right combination of elements to post an earnings beat this quarter.
Apple Inc. (AAPL - Free Report) , with an earnings ESP of +1.21% and a Zacks Rank #2.The company’s earnings surpassed the Zacks Consensus Estimate in three of the previous four quarters.
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Cincinnati Bell (CBB) Q3 Earnings: A Beat in the Cards?
Telecom service provider Cincinnati Bell Inc. is slated to report third-quarter 2016 results on Nov 2, before the opening bell.
Last quarter, the company posted a negative earnings surprise of 50.00%. Moreover, the company’s earnings lagged the Zacks Consensus Estimate in two of the previous four quarters, the average miss being 16.67%. Let’s see how things are shaping up for this announcement.
Why a Likely Positive Surprise?
Our proven model shows that Cincinnati Bellis likely to beat estimates because it has the right combination of two key elements.
Zacks ESP: Cincinnati Bell has an Earnings ESP of +20.00%. This is because the Most Accurate estimate is pegged at 6 cents while the Zacks Consensus Estimate is lower at 5 cents. This is a meaningful and leading indicator of a likely positive earnings surprise. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
Zacks Rank: Cincinnati Bell has a Zacks Rank #3 (Hold). Note that stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating estimates. Conversely, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
The combination of Cincinnati Bell’s Zacks Rank #3 and +20.00% ESP makes us confident of an earnings beat at the company. You can see the complete list of today’s Zacks #1 Rank stocks here.
What is Driving the Better-than-Expected Earnings?
Cincinnati Bell is focused on transforming itself from a legacy copper-based telecommunications company into a technology firm offering flexible data, video, voice and IP solutions to both consumer and business customers. In the Entertainment and Communications business, the company’s investments in Fioptics products, which provide entertainment, high-speed Internet and traditional voice via fiber line to homes, are on the rise. Recently, the company signed a deal with The E.W. Scripps Company, an American broadcasting company based in Cincinnati. Per the deal, Scripps’ wholly owned subsidiary Newsy – a digital video news channel – will now be available on Cincinnati Bell’s Fioptics lineup of HD channels. Newsy is accessible on devices such as Apple’s Apple TV, Dish Network Corp.’s Sling TV, Roku, Amazon.com Inc.’s (AMZN - Free Report) Fire TV and Google’s Chromecast.
Additionally, increased investments in strategic products are expected to open up ample opportunities for enterprise customers, thus boosting Cincinnati Bell’s revenues and profits. Creation of a new business division for supporting small and mid-sized businesses and development of its IT Services and Hardware division should rake in more profits.
On the flip side, continuous erosion in local access lines, heavy capital expenditure requirements and legal hurdles raise caution. Moreover, intensifying competition in the company’s operational region can prove to be a drag on its pricing power, thereby inducing pressure on margins.
CINCINNATI BELL Price and EPS Surprise
CINCINNATI BELL Price and EPS Surprise | CINCINNATI BELL Quote
Stock to Consider
Cincinnati Bell is not the only company looking up this earnings season. Here is a company that has the right combination of elements to post an earnings beat this quarter.
Apple Inc. (AAPL - Free Report) , with an earnings ESP of +1.21% and a Zacks Rank #2.The company’s earnings surpassed the Zacks Consensus Estimate in three of the previous four quarters.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>