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Will Top-Line Improvement Aid Bandwidth (BAND) Q4 Earnings?

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Bandwidth Inc. (BAND - Free Report) is scheduled to report fourth-quarter 2022 results on Feb 23, before the opening bell. In the last reported quarter, the company delivered a stellar earnings surprise of 800%. It pulled off a trailing four-quarter earnings surprise of 301.8%, on average.

The Raleigh, NC-based company is expected to have recorded higher revenues year over year, despite a challenging macroeconomic environment.

Factors at Play

During the fourth quarter, Bandwidth announced the launch of Call Assure, a first-in-the-industry comprehensive disaster recovery solution with high-value U.S. toll-free calls. Call Assure expands Bandwidth's already highly resilient toll-free offering by adding the capability of an alternative routing facility that is fully insulated from the core network to protect against disruptions like fire, natural disaster or cyberattack. This is likely to be reflected in the upcoming results.

Bandwidth enables enterprises to rapidly scale communications functionalities to a vast range of applications and devices with its easy-to-use software APIs. Continuous innovation on Communications Platform-as-a-Service (CPaaS) offerings allows enterprise customers to have direct access to Bandwidth’s comprehensive suite of products and services that cater to the networking requirements of large-scale Internet companies and cloud service providers based in the United States. Backed by an avant-garde software platform, the company monitors and resolves any network-related issues on a real-time basis. Such state-of-the-art products are likely to have aided its performance in the quarter.

However, challenging market conditions and business uncertainty might have had a detrimental effect on its revenues as customers tend to be more cautious in their investments.

The Zacks Consensus Estimate for revenues is pegged at $147 million, up from the year-ago quarter’s reported figure of $126 million. The consensus estimate for adjusted earnings per share stands at 4 cents, suggesting a decrease from 9 cents reported a year ago.

Earnings Whispers

Our proven model does not predict an earnings beat for Bandwidth for the fourth quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%, with both pegged at 4 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Bandwidth Inc. Price and EPS Surprise

Bandwidth Inc. Price and EPS Surprise

Bandwidth Inc. price-eps-surprise | Bandwidth Inc. Quote

Zacks Rank: Bandwidth has a Zacks Rank #2.

Other Stocks to Consider

Here are some other companies you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat this season:

Allegion plc (ALLE - Free Report) is set to release quarterly numbers on Feb 22. It has an Earnings ESP of +4.19% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Earnings ESP for IMAX Corporation (IMAX - Free Report) is +13.33% and it carries a Zacks Rank of 2. The company is set to report quarterly numbers on Feb 22.

The Earnings ESP for iQIYI, Inc. (IQ - Free Report) is +20.00% and it carries a Zacks Rank of 2. The company is scheduled to report quarterly numbers on Feb 22.

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

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