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Paramount Global (PARA) to Report Q4 Earnings: What's in Store?

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Paramount Global (PARA - Free Report) is set to report fourth-quarter 2022 earnings on Feb 16.

For the quarter, the Zacks Consensus Estimate for earnings has moved south by 28% to 18 cents per share in the past 30 days. The figure indicates a 30.77% plunge from the year-ago quarter’s reported figure.

The consensus mark for revenues is pegged at $8.06 billion, indicating a 0.71% increase from the year-ago quarter’s reported figure.

The company’s earnings beat the Zacks Consensus Estimate in two of the last four quarters, missed once and matched the same on the other occasion. Paramount Global has a trailing four-quarter negative earnings surprise of 2.5% on average.

Let’s see how things have shaped up for this announcement.

Paramount Global Price and EPS Surprise

Paramount Global Price and EPS Surprise

Paramount Global price-eps-surprise | Paramount Global Quote

Factors to Consider

Paramount Global’s fourth-quarter 2022 performance is expected to have benefited from a steady cable network portfolio. The growing traction of Showtime, BET, Comedy Central and Nickelodeon is expected to have boosted the top line.

An expanding content catalog of live sporting events and a solid portfolio of streaming services, including CBS All Access, Showtime OTT, Pluto TV, Noggin and BET+ are expected to have boosted viewership and ad revenues in the third quarter.

In the third quarter, global streaming subscribers rose to nearly 67 million, which included the addition of 4.7 million DTC subscribers. Paramount+ subscribers grew to 46 million, which reflects the addition of 4.6 million subscribers and the removal of 1.9 million Paramount+ subscribers, following the launch of SkyShowtime to replace Paramount+ in the Nordics.

Top Gun: Maverick has now become the most-watched film globally on Paramount+. Debuting on the streaming service on Dec 22, the film broke Paramount's previous record held by Sonic the Hedgehog 2 by 60%.

Pluto TV gained immense popularity with more than 250 live events, linear channels and thousands of hours of on-demand content. Pluto TV partners with more than 175 content providers, including media houses, film and TV studios that help it produce various content.

In the third quarter, Pluto TV maintained its lead as the #1 free ad-supported streaming tv service in the United States. Pluto TV’s global monthly active users increased to nearly 72 million. Pluto TV’s total global viewing hours grew by strong double-digits year over year. The trend is likely to have continued in the to-be-reported quarter.

Pluto TV expanded its international presence by launching in Canada through a partnership with Toronto-based Corus Entertainment, which has a large library of food and lifestyle programming and operates Global News. This is expected to have boosted the streamer’s global monthly active users in the to-be-reported quarter.

Advertisers, however, continue to face supply-chain disruptions and labor shortages and many others are contending with rising costs amid record inflation, which have led to cutbacks in spending on advertising. This is expected to have hampered ad revenue growth in the to-be-reported quarter.

Paramount has been facing a slump in its ad revenues, which declined 2% in third-quarter fiscal 2022 and is expected to decline by a larger percentage in the fiscal fourth quarter as well, as per CEO Robert Bakish.

What Our Model Says

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Paramount Global has an Earnings ESP of -20.91% and carries a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this season.

Endava (DAVA - Free Report) has an Earnings ESP of +1.47% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Endava is set to report its second-quarter fiscal 2023 results on Feb 14. The Zacks Consensus Estimate for DAVA’s earnings is pegged at 68 cents per share, suggesting an increase of 7.94% from the prior-year period’s reported figure.

Airbnb (ABNB - Free Report) has an Earnings ESP of +8.10% and a Zacks Rank #3 at present.

Airbnb is scheduled to release its fourth-quarter 2022 results on Feb 14. The Zacks Consensus Estimate for ABNB’s earnings is pegged at 27 cents per share, suggesting an increase of 237.5% from the prior-year quarter’s reported figure.

TripAdvisor (TRIP - Free Report) has an Earnings ESP of +112.90% and a Zacks Rank #3 at present.

TripAdvisor is scheduled to release its fourth-quarter 2022 results on Feb 14. The Zacks Consensus Estimate for TRIP’s earnings is pegged at 5 cents per share. The company reported a loss of a cent per share in the prior-year quarter.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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