GoDaddy Inc. (GDDY - Free Report) is set to report second-quarter 2017 results on Aug 8.
Last quarter, the company delivered a positive earnings surprise of 125.00%, with an average beat of 51.67%.
The company's shares have gained only 21.8% year to date, underperforming the industry’s gain of 26.1%.
Let's see how things are shaping up for this announcement.
Factors to Consider
GoDaddy is engaged in the designing and development of cloud-based technology products for small businesses, Web design professionals and individuals. GoDaddy’s strong market position, increasing investments in products, technology platform and customer care should boost second-quarter results. We also expect its focus on delivering innovative and increasingly personalized products and services globally to bear fruit.
Also, the company is striving toward expanding internationally by investing in technology, marketing programs and customer care teams. Growing international presence and the shift toward dynamic online presence for small business is likely to play an important role going forward. Moreover, with product development and more effective ads, the company is trying to establish itself as a serious player.
However, significant competition, heavy debt burden and controversies surrounding the company could pose challenges.
Our proven model does not conclusively show that GoDaddy will beat estimates 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. That is not the case here as you will see below.
Zacks ESP: GoDaddy has an Earnings ESP of 0.00%. Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 3 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: GoDaddy’s Zacks Rank #3 increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of an earnings surprise.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.
Stocks to Consider
You could consider the following stocks with a positive Earnings ESP and a favorable Zacks Rank:
CACI International (CACI - Free Report) with an Earnings ESP of +1.83% and a Zacks Rank #2.You can see the complete list of today’s Zacks #1 Rank stocks here.
Broadcom Limited (AVGO - Free Report) with an Earnings ESP of +2.57% and a Zacks Rank #2.
MTS Systems Corporation (MTSC - Free Report) with an Earnings ESP of +4.35% and a Zacks Rank #3.
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