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DISH Network (DISH) Q3 Earnings: Disappointment in Store?
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DISH Network Corp. – the second largest satellite TV operator in the U.S. – is slated to report third-quarter 2016 financial numbers before the opening bell on Nov 9.
Last quarter, DISHNetwork posted a positive earnings surprise of 18.92%. Moreover, the company’s earnings surpassed the Zacks Consensus Estimate in all of the previous four quarters, with an average beat of 117.46%. Let’s see how things are shaping up for this announcement.
Factors at Play
DISH Network’s top-line growth may remain under pressure as the company’s failure to strike any deal with wireless operators to deploy a nationwide wireless network has been a major headwind. Persistent loss of subscribers remains a potent headwind for DISH Network. Also, the company’s may be affected by its failure to renew long-term programming contracts on favorable pricing and other economic terms. Also, escalating programming and content expenses and retransmission fees may also hurt the company’s margins.
However, the company is poised to benefit from its recent launch of a new version of its Internet TV service -- Sling TV – which will allow subscribers to stream up to three different devices simultaneously for $20 a month. Further, in the beginning of Sep 2016, the company ended the three-month scuffle and reached a new retransmission agreement with Tribune Broadcasting, a subsidiary of Tribune Media Company . This fresh contract puts an end to the blackout of Tribune Broadcasting’s channels on Dish Network since June this year.
Thus, DISH Network’s efforts to diversify its business model from being a pure-play satellite-TV operator to an Internet TV operator should aid the company’s performance as it has emerged as a strong alternative to counter competitive threat from low-cost video streaming operators.
Earnings Whispers
Our proven model does not conclusively show that DISH Networkis likely to beat the Zacks Consensus Estimate 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. Unfortunately, that is not the case here as elaborated below.
Zacks ESP: DISHNetwork has an Earnings ESP of -5.80%. This is because the Most Accurate estimate stands at 65 cents while the Zacks Consensus Estimate is pegged higher at 69 cents. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
Zacks Rank: DISH Network has a Zacks Rank #4 (Sell). Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Microsoft Corporation (MSFT - Free Report) , with an Earnings ESP of +1.30% and a Zacks Rank #3.The company’s earnings surpassed the Zacks Consensus Estimate in three of the previous four quarters.
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DISH Network (DISH) Q3 Earnings: Disappointment in Store?
DISH Network Corp. – the second largest satellite TV operator in the U.S. – is slated to report third-quarter 2016 financial numbers before the opening bell on Nov 9.
Last quarter, DISH Network posted a positive earnings surprise of 18.92%. Moreover, the company’s earnings surpassed the Zacks Consensus Estimate in all of the previous four quarters, with an average beat of 117.46%. Let’s see how things are shaping up for this announcement.
Factors at Play
DISH Network’s top-line growth may remain under pressure as the company’s failure to strike any deal with wireless operators to deploy a nationwide wireless network has been a major headwind. Persistent loss of subscribers remains a potent headwind for DISH Network. Also, the company’s may be affected by its failure to renew long-term programming contracts on favorable pricing and other economic terms. Also, escalating programming and content expenses and retransmission fees may also hurt the company’s margins.
However, the company is poised to benefit from its recent launch of a new version of its Internet TV service -- Sling TV – which will allow subscribers to stream up to three different devices simultaneously for $20 a month. Further, in the beginning of Sep 2016, the company ended the three-month scuffle and reached a new retransmission agreement with Tribune Broadcasting, a subsidiary of Tribune Media Company . This fresh contract puts an end to the blackout of Tribune Broadcasting’s channels on Dish Network since June this year.
Thus, DISH Network’s efforts to diversify its business model from being a pure-play satellite-TV operator to an Internet TV operator should aid the company’s performance as it has emerged as a strong alternative to counter competitive threat from low-cost video streaming operators.
Earnings Whispers
Our proven model does not conclusively show that DISH Networkis likely to beat the Zacks Consensus Estimate 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. Unfortunately, that is not the case here as elaborated below.
Zacks ESP: DISH Network has an Earnings ESP of -5.80%. This is because the Most Accurate estimate stands at 65 cents while the Zacks Consensus Estimate is pegged higher at 69 cents. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
Zacks Rank: DISH Network has a Zacks Rank #4 (Sell). Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
DISH NETWORK CP Price and EPS Surprise
DISH NETWORK CP Price and EPS Surprise | DISH NETWORK CP Quote
Key Picks
Here are some companies that have the right combination of elements to post an earnings beat this quarter.
Verizon Communications Inc. (VZ - Free Report) , with an Earnings ESP of +1.11% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here. The company’s earnings beat the Zacks Consensus Estimate in three of the previous four quarters.
Microsoft Corporation (MSFT - Free Report) , with an Earnings ESP of +1.30% and a Zacks Rank #3.The company’s earnings surpassed the Zacks Consensus Estimate in three of the previous four quarters.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>