), one of the leading media company in United States and worldwide,
is expected to release its second-quarter 2012 financial results on
Thursday, August 2, 2012, after the market closes.
The Zacks Consensus Estimate for second quarter 2012 stands at
58 cents, flat year over year. The estimate lies between a low of
54 cents and a high of 64 cents. Revenue, as per the Zacks
Consensus Estimate, is pegged at $3,543 million.
First Quarter Highlights
CBS Corporation posted better-than-expected first quarter 2012
results. Quarterly earnings of 54 cents per share were way ahead of
the Zacks Consensus Estimate of 44 cents and surged 86% from 29
cents earned in the year-ago quarter.
Revenues jumped 12% year over year to $3,924 million. The growth
was due to a 39% rise in content licensing and distribution
revenues to $1,017 million along with a 5% increase in advertising
revenues to $2,398 million. Moreover, affiliate and subscription
fees rose 7% to $455 million. Total revenue also exceeded the Zacks
Consensus Estimate of $3,780 million.
Agreement of Estimate Revisions
For the second-quarter of 2012, one and two estimates went up
(out of 22) in the last 7 and 30 days, respectively, whereas two
estimates were trimmed in the last 30 days. For fiscal 2012, out of
25 estimates, two and seven estimates were revised upwards over the
last 7 and 30 days, respectively, and two estimates went down in
the last 30 days.
Magnitude of Estimate Revisions
Due to the lack of near-term catalysts impacting the estimates
directly or indirectly, the estimates remained unchanged at 58
cents over the last 7 and 30 days for the to-be-reported quarter,
whereas for fiscal 2012, the estimates went up by a penny over the
last 30 days.
Positive Earnings Surprise History
CBS Corporation has been performing well, reflected by the
better-than-expected results over the last four quarters. With
respect to earnings surprise, CBS Corp has outperformed the Zacks
Consensus Estimate with an average of 17.0% over the last four
quarters. Looking at the company's past performance, we expect CBS
to top the estimates in the coming quarters as well.
CBS, which competes with
), has been actively managing its cash flows by generating healthy
free cash, making prudent capital investments and enhancing
The company generated free cash flow of $607 million, incurred
capital expenditures of $39 million, repurchased shares worth of
$269 billion in the first quarter and ended with cash and cash
equivalents of $794 million.
The company's decision to increase its share repurchases
authorization and dividend clearly suggests the ability to generate
liquidity and its potential to improve in the long run.
CBS remains well positioned to drive revenue growth in the
coming quarters through its strategic initiatives and operating
efficiencies. Management remains optimistic and expects growth
momentum to continue in fiscal 2012 based on reverse compensation
from affiliates, strong demand of its content and online video
streaming, retransmission consent, and political advertising.
Based on better-than-expected results and ability to generate
strong free cash flow, CBS Corporation carries Zacks #2 Rank,
implying a short-term Buy rating. We also maintain our long-term
Outperform recommendation on the stock.
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