We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Can Level 3 Communications (LVLT) Q1 Earnings Surprise?
Read MoreHide Full Article
Level 3 Communications Inc. , the leading U.S. fiber-optic network service provider, is slated to report first-quarter 2017 financial numbers, after the market closes on May 3.
Last quarter, Level 3 Communications posted a positive earnings surprise of 36.36%. Moreover, the company’s earnings surpassed the Zacks Consensus Estimate in two of the previous four quarters, with an average beat of 3.40%.
Shares of Level 3 Communications gained 2.6% failing to beat the Zacks sub-categorized Communication Infrastructure industry’s growth of 9.0%, over the past three months.
Let’s see how things are shaping up for this announcement.
Factors at Play
Level 3 Communications operates in a highly competitive enterprise communications market. Inspite of its vast presence in the fiber market of Latin America, Europe, Middle East and Asia, it has to compete with telecom behemoths like Verizon Communications Inc. (VZ - Free Report) and AT&T Inc. (T - Free Report) in North America and with Telefonica, Orange, BT Group, America Movil in Europe and Latin America.
Moreover, fluctuations in the global macro economy could have an adverse effect on the company’s business, results of operations and financial condition. Notably, the company faces the risk of adverse foreign currency movements that may impact its top line. Also, the company’s high customer concentrationis a major concern.
Nevertheless, the company has a strong presence in the fields of enterprise networking like data networks, content distribution, managed services, securities, voice cloud and cloud connection. The company continues to benefit from the ongoing trend of large enterprise customers shifting to IP and fiber-based network architecture.
Additionally, the company is on the lookout for strategic mergers and acquisitions or stock buyouts to maximize shareholders’ value. Meanwhile, Level 3 Communications’ plans to expand its Ethernet Services in the Asia Pacific region looks good.
Earnings Whispers
Our proven model does not conclusively show that Level 3 Communications 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, that is not the case here as elaborated below.
Zacks ESP: Level 3 Communications has an Earnings ESP of -13.89%. This is because the Most Accurate estimate stands at 31 cents while the Zacks Consensus Estimate is pegged higher at 36 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Level 3 Communications has a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s negative ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Level 3 Communications, Inc. Price and EPS Surprise
Here is a company in the Zacks-categorized broader Computer and Technology sector — which houses Level 3 Communications — that has the right combination of elements to post an earnings beat this quarter.
SBA Communications’ earnings failed to beat the Zacks Consensus Estimate in any of of the previous four quarters, resulting in an average miss of 79.81%.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors. Click here for Zacks' secret trade>>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Can Level 3 Communications (LVLT) Q1 Earnings Surprise?
Level 3 Communications Inc. , the leading U.S. fiber-optic network service provider, is slated to report first-quarter 2017 financial numbers, after the market closes on May 3.
Last quarter, Level 3 Communications posted a positive earnings surprise of 36.36%. Moreover, the company’s earnings surpassed the Zacks Consensus Estimate in two of the previous four quarters, with an average beat of 3.40%.
Shares of Level 3 Communications gained 2.6% failing to beat the Zacks sub-categorized Communication Infrastructure industry’s growth of 9.0%, over the past three months.
Let’s see how things are shaping up for this announcement.
Factors at Play
Level 3 Communications operates in a highly competitive enterprise communications market. Inspite of its vast presence in the fiber market of Latin America, Europe, Middle East and Asia, it has to compete with telecom behemoths like Verizon Communications Inc. (VZ - Free Report) and AT&T Inc. (T - Free Report) in North America and with Telefonica, Orange, BT Group, America Movil in Europe and Latin America.
Moreover, fluctuations in the global macro economy could have an adverse effect on the company’s business, results of operations and financial condition. Notably, the company faces the risk of adverse foreign currency movements that may impact its top line. Also, the company’s high customer concentrationis a major concern.
Nevertheless, the company has a strong presence in the fields of enterprise networking like data networks, content distribution, managed services, securities, voice cloud and cloud connection. The company continues to benefit from the ongoing trend of large enterprise customers shifting to IP and fiber-based network architecture.
Additionally, the company is on the lookout for strategic mergers and acquisitions or stock buyouts to maximize shareholders’ value. Meanwhile, Level 3 Communications’ plans to expand its Ethernet Services in the Asia Pacific region looks good.
Earnings Whispers
Our proven model does not conclusively show that Level 3 Communications 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, that is not the case here as elaborated below.
Zacks ESP: Level 3 Communications has an Earnings ESP of -13.89%. This is because the Most Accurate estimate stands at 31 cents while the Zacks Consensus Estimate is pegged higher at 36 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Level 3 Communications has a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s negative ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Level 3 Communications, Inc. Price and EPS Surprise
Level 3 Communications, Inc. Price and EPS Surprise | Level 3 Communications, Inc. Quote
Key Pick
Here is a company in the Zacks-categorized broader Computer and Technology sector — which houses Level 3 Communications — that has the right combination of elements to post an earnings beat this quarter.
SBA Communications Corporation (SBAC - Free Report) is expected to release first-quarter 2017 results on May 1. The company has an Earnings ESP of +4.55% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
SBA Communications’ earnings failed to beat the Zacks Consensus Estimate in any of of the previous four quarters, resulting in an average miss of 79.81%.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors. Click here for Zacks' secret trade>>