Dish Network Corp.
) is slated to release its third-quarter 2012 earnings results on
Tuesday, November 6, before the opening bell. The Zacks Consensus
Estimate for the reported quarter is pegged at $0.55,
representing a decline of 22.13% from the year-ago quarter.
With respect to earnings surprises, Dish Network has
outperformed the Zacks Consensus Estimate in two of the last four
quarters with an average beat of 4.26%.
Second Quarter Recap
On August 8, Dish Network reported its second-quarter 2012
financial results. Adjusted earnings per share (excluding special
items) of 59 cents in the second quarter were shy of the Zacks
Consensus Estimate of 63 cents. Quarterly GAAP net income was
approximately $225.7 million or 50 cents per share compared with
a net income of $334.8 million or 75 cents per share in the
Dish Network posted quarterly total revenue of about $3,571.8
million, down 0.5% year over year and also below the Zacks
Consensus Estimate of $3,650 million. Second-quarter 2012
operating income plummeted by 34.8% to $468.4 million while,
quarterly EBITDA was around $760.2 million compared with $935
million in the year-ago quarter.
Agreement of Estimate Revisions
Over the last one month, out of the total 14 estimates, three
were revised upward while two moved in the opposite direction for
the third quarter. For the fourth quarter of 2012, out of the
total 13 estimates, no upward revision was witnessed, while two
moved downward over the same time frame.
In the last 30 days, out of the total 10 estimates, there were
two upward revisions while the same number of estimates moved in
the opposite direction for 2012. For 2013, out of the total 14
estimates, three estimates moved north, while four moved south
over the same time period.
Magnitude of Estimate Revisions
Over the last 30 days, the current Zacks Consensus Estimate
has remained unchanged at 55 cents for the third and fourth
quarter of 2012. However, the current Zacks Consensus Estimate
improved by a penny for 2012 over the last 30 days, while the
estimate has deteriorated by 5 cents to $2.45 for 2013 over the
same time frame.
DISH Network is transforming itself from a low-priced leader
in the U.S. pay-TV industry to a premium service provider to
reduce its subscribers' churn rate. Innovative features like the
AUTO HOP technology that enables any DISH Network subscriber to
record prime time TV programming from four major networks could
act as a value addition for its customers thereby driving
subscriber growth and retention. Additionally, the new movie
streaming services that DISH Network started after its
acquisition of Blockbuster movie chain have not only led to
better overall pay-TV services and increased customer loyalty but
will also boost subscriber growth in the upcoming quarters.
However, the company faces stiff competition from
) and other cable TV operators. Furthermore, Telecom operators
are quickly gaining market share from cable TV and satellite TV
service providers by offering fiber-based TV and other high-speed
broadband services to subscribers thus posing a threat to DISH
We maintain our long-term Neutral recommendation on Dish
Network Corp. Currently, the company retains a short-term
Zacks #3 Rank (Hold) on the stock.
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