), a diversified media and information services conglomerate, is
slated to report fourth-quarter fiscal 2014 results on Aug 7. In
the last quarter, it posted a positive surprise of 266.7%. Let's
see how things are shaping up for this announcement.
Factors Influencing the Quarter
Advertising, which forms a major part of News Corporation's
total revenue, is highly vulnerable to the economic conditions.
Another hindrance to growth might come from the company's inability
to renew sports programming rights under favorable terms. However,
the company's diverse revenue streams hedge it against economic
The company derives revenues from subscriptions, copy
circulation, licensing and affiliate fees, direct sales and
advertising and sponsorships. The company is also concentrating on
pursuing integrated strategies to take advantage of the transition
to digital content from print.
Our proven model does not conclusively show that News
Corporation is likely to beat earnings estimates this quarter. This
is because a stock needs to have both a positive
and a Zacks Rank #1 or 2 or 3 for this to happen. This is not the
case here, as you will see below.
Earnings ESP for News Corporation is -25.00%. This is because the
Most Accurate estimate stands at 3 cents, while the Zacks Consensus
Estimate is pegged at 4 cents.
News Corporation's Zacks Rank #4 (Sell) lowers the predictive power
of ESP. We caution against stocks with a Zacks Ranks #4 and 5
(Sell-rated stocks) going into the earnings announcement,
especially when the company is seeing negative estimate
Stocks That Warrant a Look
Here are some companies you may want to consider as our model
shows that these have the right combination of elements:
Chipotle Mexican Grill, Inc. (
) has an Earnings ESP of +0.79% and a Zacks Rank #1 (Strong
Abercrombie & Fitch Co. (
) has an Earnings ESP of +20.00% and a Zacks Rank #2 (Buy).
Macy's, Inc. (
) has an Earnings ESP of +1.16% and a Zacks Rank #3 (Hold).
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