) is set to report second quarter 2013 results on Jul 25. Last
quarter, it posted a 318% negative surprise. Let's see how things
are shaping up for this announcement.
Growth Factors This Past Quarter
Expedia's earnings in the last quarter were 27 cents, short of
the Zacks Consensus Estimate, due to weaker margins. The growing
mix of international business negatively impacted gross margins.
However, revenues were up sequentially helped by a stronger
travel market all over the world, contributions from VIA and
Trivago and strategic expansion in Asia.
We believe Expedia's growth in Asia (much lower ADRs and
revenue per room night) remains much stronger than other regions
and this will likely cast a negative impact on margins, while
driving up volumes.
The Zacks Consensus Estimate for the second quarter stands at
70 cents per share while that for fiscal 2013 stands at
Expedia has missed estimates once in the last four quarters,
while beating estimates three times.
There have been no estimate revisions in the last 30 days. As
a result, the Zacks Consensus Estimate for the second quarter as
well as for 2013 has remained unchanged during this time period.
The stock carries a Zacks Rank #2 (Buy).
We caution against stocks with Zacks Ranks #4 and #5
(Sell-rated stocks) going into the earnings announcement,
especially when the company is seeing negative estimate revisions
Other Stocks to Consider
Our model states that astock needs to have both a positive
earnings expected surprise prediction or ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #1, #2 or #3 to beat earnings estimates. You
could, therefore, consider the following stocks
EXPEDIA INC (EXPE): Free Stock Analysis
INVENSENSE INC (INVN): Free Stock Analysis
SCIENTIFIC GAME (SGMS): Free Stock Analysis
SYNTEL INC (SYNT): Free Stock Analysis Report
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), with an ESP of +0.82% and a Zacks Rank #1 (Strong Buy)
), Earnings ESP of +8.33% and a Zacks Rank #2 (Buy)
Scientific Games Corp.
), with an ESP of +100.0% and a Zacks Rank #3 (Hold)