We expect Canada-based
), to beat expectations when it reports its first-quarter 2013
results on May 9, 2013.
Why a Likely Positive Surprise?
Our proven model shows that Telus is likely to beat earnings
because it has the right combination of two key ingredients.
Positive Zacks ESP
: Expected Surprise Prediction or ESP (Read: Zacks Earnings ESP:
A Better Method), which represents the difference between the
Most Accurate estimate and the Zacks Consensus Estimate, is
+3.77%. This is a meaningful and leading indicator of a likely
positive earnings surprise.
Zacks Rank #3 (Hold)
: Telus currently has a Zacks Rank #3. Note that the stocks with
a Zacks Rank #1 (Strong Buy), 2 (Buy) and 3 (Hold) have a
significantly higher chance of beating the earnings.
The combination of Telus's Zacks Rank #3 (Hold) and +3.77% ESP
makes us confident of a positive earnings beat on May 9, 2013.
What is Driving the Better-Than-Expected
Telus' ongoing investment in the expansion of its fiber optic
network provides compelling home entertainment services in the
Western Canadian market. The company continues to add new
features as well as upgrading the existing features of its
popular Optik TV and Optik High Speed Internet broadband services
that are gaining strong traction across the Canadian region.
The company is providing 4G LTE networks with the popular
smartphones, which resulted in solid growth in its post-paid
However, Telus remains challenged by the weak Canadian economy
and domestic competition, which is expected to intensify with the
entry of new wireless players. Moreover, higher burden of
subsidy cost associated with smartphones coupled with lack of
spectrum will continue to impede the company's growth
Other Stocks to Consider
Other companies you may consider on the basis of our model, which
have the right combination of elements to post an earnings beat
this quarter are as follows:
Research in Motion Limited
) currently has an Earnings ESP of +200.00% and holds a Zacks
Rank #2 (Buy).
Sprint Nextel Corp.
) has an Earnings ESP of +6.45% and holds a Zacks Rank #3 (Hold).
Dish Network Corporation
) has an Earnings ESP of +1.89% and carries a Zacks Rank #3
RESEARCH IN MOT (BBRY): Free Stock Analysis
DISH NETWORK CP (DISH): Free Stock Analysis
SPRINT NEXTEL (S): Free Stock Analysis Report
TELUS CORP (TU): Free Stock Analysis Report
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