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What's in Store for Melco Resorts (MLCO) in Q1 Earnings?
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Melco Resorts & Entertainment Limited (MLCO - Free Report) is scheduled to report first-quarter 2017 numbers on May 4, before the opening bell.
Last quarter, Melco Resorts posted a 30% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters with an average beat of 90.42%.
Melco Crown Entertainment Limited Price and EPS Surprise
Let’s see how things are shaping up for this announcement.
Factors to Consider
Melco Resorts’ revenues have been hurt by its sluggish performance in Macau over the past few quarters. Nevertheless, per the Macau Gaming Inspection and Coordination Bureau, gross gaming revenues (GGR) rose in all the three months of the quarter, thereby continuing the revival in Macau. We thus expect the company’s performance in the region to get a boost in the to-be-reported quarter.
Conversely, the results may be somewhat hampered as concerns related to the sustainability of revenues from the VIP market linger.
Meanwhile, better performance at the non-gaming segments like rooms and food and beverages are expected to drive the quarter’s results. The company’s large-scale resorts provide distinctive lodging, entertainment and retail options, which appeals to a broader audience from around the region. Additionally, the company’s cost-control efforts including effective management of marketing expenses are likely to boost first-quarter profits and margins.
Furthermore, the addition of new VIP tables at the company’s Studio City property is set to deliver a broader product offering to a wider breadth of customers, which in turn is expected to drive increased profitability.
The management also expects Philippines’ gaming industry to be supported by the country's robust economic growth and its expanding inbound tourism strategy. Thus, Melco’s Entertainment City property therein is poised to largely benefit from this growth.
Earnings Whispers
Our proven model does not conclusively show earnings beat for that Melco Resorts 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. That is not the case here, as you will see below.
Zacks ESP: Earnings ESP for Melco Resorts is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 8 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Melco Resorts currently carries a Zacks Rank #3, which when combined with an ESP of 0.00% makes surprise prediction difficult.
Note that 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 revision.
Stocks to Consider
Here are some companies in the broader consumer discretionary sector to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
MSG Networks, Inc. has an Earnings ESP of +36.36% and a Zacks Rank #2.
Hilton Worldwide Holdings, Inc. (HLT - Free Report) has an Earnings ESP of +10.71% and a Zacks Rank #3.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500. See today's Zacks "Strong Sells" absolutely free >>
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What's in Store for Melco Resorts (MLCO) in Q1 Earnings?
Melco Resorts & Entertainment Limited (MLCO - Free Report) is scheduled to report first-quarter 2017 numbers on May 4, before the opening bell.
Last quarter, Melco Resorts posted a 30% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters with an average beat of 90.42%.
Melco Crown Entertainment Limited Price and EPS Surprise
Melco Crown Entertainment Limited Price and EPS Surprise | Melco Crown Entertainment Limited Quote
Let’s see how things are shaping up for this announcement.
Factors to Consider
Melco Resorts’ revenues have been hurt by its sluggish performance in Macau over the past few quarters. Nevertheless, per the Macau Gaming Inspection and Coordination Bureau, gross gaming revenues (GGR) rose in all the three months of the quarter, thereby continuing the revival in Macau. We thus expect the company’s performance in the region to get a boost in the to-be-reported quarter.
Conversely, the results may be somewhat hampered as concerns related to the sustainability of revenues from the VIP market linger.
Meanwhile, better performance at the non-gaming segments like rooms and food and beverages are expected to drive the quarter’s results. The company’s large-scale resorts provide distinctive lodging, entertainment and retail options, which appeals to a broader audience from around the region. Additionally, the company’s cost-control efforts including effective management of marketing expenses are likely to boost first-quarter profits and margins.
Furthermore, the addition of new VIP tables at the company’s Studio City property is set to deliver a broader product offering to a wider breadth of customers, which in turn is expected to drive increased profitability.
The management also expects Philippines’ gaming industry to be supported by the country's robust economic growth and its expanding inbound tourism strategy. Thus, Melco’s Entertainment City property therein is poised to largely benefit from this growth.
Earnings Whispers
Our proven model does not conclusively show earnings beat for that Melco Resorts 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. That is not the case here, as you will see below.
Zacks ESP: Earnings ESP for Melco Resorts is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 8 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Melco Resorts currently carries a Zacks Rank #3, which when combined with an ESP of 0.00% makes surprise prediction difficult.
Note that 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 revision.
Stocks to Consider
Here are some companies in the broader consumer discretionary sector to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
MSG Networks, Inc. has an Earnings ESP of +36.36% and a Zacks Rank #2.
Norwegian Cruise Line Holdings, Inc. (NCLH - Free Report) has an Earnings ESP of +2.70% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hilton Worldwide Holdings, Inc. (HLT - Free Report) has an Earnings ESP of +10.71% and a Zacks Rank #3.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500. See today's Zacks "Strong Sells" absolutely free >>