Liberty Interactive Corporation
) is slated to report its fourth-quarter 2013 financial results
before the opening bell on Feb 28, 2014.
In the last quarter, the company's earnings came in line with
the Zacks Consensus Estimate. Let's see whether the situation has
changed in the fourth quarter.
Factors to be Considered this Quarter
Liberty Interactive's QVC division is benefiting from the
surge in online sales. Management stated that its online sales
will constitute more than 50% of the total revenue in the U.S. by
2014. Exposure to international markets, such as Japan, Germany,
Italy, and the U.K., will enable QVC to achieve a high rate of
growth. QVC is gradually foraying into these developed
However, the major concern for Liberty Interactive is the
fluctuating growth rate of its QVC segment in the last four
quarters. This segment currently generates approximately 85% of
the company's total revenue and 100% of the operating profit.
Thus, any interruption in the revenue stream of QVC will
significantly affect the company's overall financials.
Our proven model does not conclusively show that Liberty
Interactive is likely to beat the Zacks Consensus Estimate this
quarter. This is because a stock needs to have both a positive
and a Zacks Rank #1, 2 or 3 for this to happen. Unfortunately,
this is not the case here as elaborated below.
Earnings ESP represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate. This leads to an ESP
of +9.30% for Liberty Interactive as the Most Accurate estimate
stands at $0.47 while the Zacks Consensus Estimate is lower at
Liberty Interactive's Zacks Rank #4 (Sell) decreases the
predictive power of ESP.
We caution investors against the stock going into the earnings
announcement, as a Zacks earnings ESP of +1.14% combined with a
Zacks Rank #4 lowers the possibility of an earnings surprise.
Other Stocks to Consider
Here are some companies to consider as our model shows these
have the right combination of elements to post an earnings beat
) with earnings ESP of +10.53% and Zacks Rank #3 (Hold).
) with earnings ESP of +3.57% and Zacks Rank #3.
NII Holdings Inc.
) with earnings ESP of +17.71% and Zacks Rank #3.
BLACKBERRY LTD (BBRY): Free Stock Analysis
LIBERTY M INT-A (LINTA): Free Stock Analysis
NII HLDGS-CL B (NIHD): Free Stock Analysis
GRUPO TELEVISA (TV): Free Stock Analysis
To read this article on Zacks.com click here.