The McGraw-Hill Companies, Inc. is slated to report its first-quarter 2013 results on Apr 30, 2013. In the last quarter, it posted bottom-line results that met the Zacks Consensus Estimate. Let’s see how things are shaping up for this announcement.
Growth Factors this Past Quarter
McGraw-Hill's strategic investments in businesses facilitate it to generate long-term profitability. The formation of S&P Dow Jones Indices coupled with S&P Capital IQ’s acquisitions of Credit Market Analysis Limited, QuantHouse, R2 Financial Technologies and TheMarkets.com position it well against its competitors to grab a wider market through superior functionality and investor oriented services and in turn help boost the top- and bottom-line results of the company.
Our proven model does not conclusively show that McGraw-Hill is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP (Read :Zacks Earnings ESP: A Better Method) and a Zacks Rank #1, #2 or #3 for this to happen. This is not the case here as you will see below.
Zacks ESP: ESP for McGraw-Hill is 0.00%. This is because the Most Accurate Estimate stands at 74 cents, which is in line with the Zacks Consensus Estimate.
Zacks Rank #2 (Buy): McGraw-Hill’s Zacks Rank #2 (Buy) lowers the predictive power of ESP because the Zacks Rank #2 when combined with 0.00% ESP makes surprise prediction difficult. We caution against stocks with Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Stocks that Warrant a Look
Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Hertz Global Holdings, Inc. (HTZ - Snapshot Report), Earnings ESP of +5.56% and a Zacks Rank #1 (Strong Buy)
J&J Snack Foods Corp.(JJSF - Snapshot Report), Earnings ESP of +9.84% and a Zacks Rank #2 (Buy)
Amazon.com Inc. (AMZN - Analyst Report), Earnings ESP of +14.29% and a Zacks Rank #3 (Hold).