Back to top

Analyst Blog

Pure-play lifestyle cable network company Scripps Network Interactive (SNI - Analyst Report) is set to release its fourth-quarter 2012 results before the opening bell on Feb 7, 2013.

Last quarter, the company delivered a 4% positive earnings surprise. Let’s see how things are shaping up for this announcement.

Factors to be Considered this Quarter

The lifestyle media segment, which represents 97.5% of the company revenue, is expected to deliver positive results on the back of improved ratings for food and Home and Garden Television (HGTV) and continuous progress in the travel business. Systematic share buyback program of the company is further expected to enhance profitability.

Scripps Network Interactive generates 65% of its revenue from marketing and advertising spending of the corporate sector in the U.S., which is sensitive to economic conditions. Thus the sluggish growth of the U.S. economy remains a major concern for Scripps.

Earnings Whispers

Our proven model does not conclusively show that Scripps Network Interactive is likely to beat the Zacks Consensus Estimate this quarter. That is because a stock needs to have both a positive Expected Surprise Prediction (ESP) (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank #1 (Strong Buy) or at least Zacks Rank #2 (Buy) or Zacks Rank #3 (Hold) for this to happen. Unfortunately this is not the case here as elaborated below.

Zacks ESP: This is because the Most Accurate estimate stands at 91 cents similar to the Zacks Consensus Estimate. This leads to a ESP of 0.00% for Scripps Network Interactive.

Zacks Rank #4 (Sell): Scripps Network Interactive's Zacks Rank #4 decreases the predictive power of ESP.

We caution investors against the stock going into the earnings announcement, as a Zacks earnings ESP of 0.00% combined with Zacks Rank #4 lowers the possibility of an earnings surprise.

Other Stocks to Consider

Here are some other companies to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:follow the example mentioned below, no need give the earnings release date.

AMC Networks Inc. (AMCX - Snapshot Report) has Earnings ESP of +9.52% and carries a Zacks Rank #2 (Buy).

Comcast Corporation (CMCSA - Analyst Report) has Earnings ESP of +1.89% and carries a Zacks Rank #3 (Hold).

News Corp Inc. (NWSA - Analyst Report) has Earnings ESP of +4.76% and carries a Zacks Rank #3 (Hold).

(Note: We are reissuing this article to correct an error. The original version, published Feb 4, 2013, is no longer to be relied upon.)

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
ERBA DIAGNO… ERB 3.00 +3.09%
SANCHEZ ENE… SN 34.18 +2.67%
THE PANTRY… PTRY 21.02 +2.09%
INTEL CP INTC 35.15 +1.88%
PIPER JAFFR… PJC 54.54 +1.70%