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Broadridge (BR) to Post Q2 Earnings: What's in the Cards?

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Broadridge Financial Solutions, Inc. (BR - Free Report) is scheduled to report second-quarter fiscal 2019 results on Feb 7, before the bell.

Notably, the company’s shares have gained 13.6% in the past year compared with the industry’s rise of 11.7%.

Top-Line Expectations

The Zacks Consensus Estimate for revenues is pegged at $970 million, indicating a decline of 4.2% from the year-ago quarter’s figure. The expected decline is likely to be caused by seasonality driven weakness in the company’s Investor Communication Solutions segment.

Processing and distribution of proxy materials and annual reports that comprises a large portion of the Investor Communication Solutions business, takes place in greatest numbers in the third and the fourth fiscal quarters. So, revenues stay considerably down in the first and the second fiscal quarters. Further, following the adoption of ASU No. 2014-09 in the first quarter of fiscal 2019, majority of revenues from equity proxy services are now recognized in the third and the fourth quarters.

In fiscal first quarter, total revenues of $973 increased 5% year over year.

Broadridge Financial Solutions, Inc. Revenue (TTM)

 

 

Bottom-Line Projections

The consensus mark for earnings per share is pegged at 70 cents, indicating year-over-year decline of 11.4%. The expected downside is likely to result from increased investments in new products and technologies, adoption of ASU No. 2014-09 and seasonality. In the last reported quarter, adjusted earnings of 79 cents surged 46% on a year-over-year basis.

Zacks Model

Please note that according to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP.

Stocks with a Zacks Rank #4 (Sell) or 5 (Strong Sell) are best avoided, especially if the companies are witnessing negative estimate revisions. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Broadridge has a Zacks Rank #4 and an Earnings ESP of 0.00%.

Stocks to Consider

Here are a few stocks from the broader Zacks Business Services sector that investors may consider as our model shows that these have the right combination of elements to beat on fourth-quarter 2018 earnings:

First Data has an Earnings ESP of +3.17% and a Zacks Rank #2. The company is scheduled to release results on Feb 6. You can see the complete list of today’s Zacks #1 Rank stocks here.

IQVIA Holdings (IQV - Free Report) has an Earnings ESP of +0.37% and a Zacks Rank #3. The company is slated to report results on Feb 14.

Fiserv has an Earnings ESP of +0.03% and a Zacks Rank #3. The company is scheduled to release results on Feb 7.

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