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Is Amdocs (DOX) Poised to Beat Earnings Est? - Analyst Blog

Amdocs Limited ( DOX ) is set to release its first-quarter fiscal 2014 results after the closing bell on Jan 29, 2014.

In the previous quarter, the company's earnings came in line with the Zacks consensus estimate. Let's see how things are shaping up for this announcement.

Factors to Influence This Quarter

Amdocs is well positioned in the market as carriers sell bundled and converged IP-based network solutions to their subscribers. These services include video, wireless, fixed-mobile converged and high-speed broadband Internet access solutions. Strong business growth in North America coupled with a double digit revenue growth in the emerging Asia Pacific markets will act as tailwinds for the company going forward.

Nevertheless, Amdocs is exposed to the global economic downturn, particularly those events that affect the telecommunications industry. Also, the global macroeconomic scenario is yet to recover completely. In addition, delay in business transformation on the part of the carriers may reduce capital spending. Furthermore, as the company is operating globally, it is also exposed to foreign currency exchange rate risk.

Earnings Whispers

Our proven model does not conclusively show that Amdocs is likely to beat the Zacks Consensus Estimate this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. Unfortunately, this is not the case here as elaborated below.

Zacks ESP: This is because both the Most Accurate estimate and the Zacks Consensus Estimate are poised at 69 cents. This leads to an ESP of 0.00% for Amdocs.

Zacks Rank #2 (Buy): Amdocs's Zacks Rank #2, decreases the predictive power of ESP.

We caution investors against the stock going into the earnings announcement, as a Zacks Earnings ESP of 0.00% combined with a Zacks Rank #2 lowers the possibility of an earnings surprise.

Other Stocks to Consider

Here are some other companies to consider as our model shows these have the right combination of elements to post an earnings beat this quarter.

Infosys Ltd. ( INFY ) with earnings ESP of +1.27% and Zacks Rank #2.

Huron Consulting Group Inc. ( HURN ) with earnings ESP of +4.04% and Zacks Rank #2.

AT&T, Inc. ( T ) with earnings ESP of +2.0% and Zacks Rank #3 (Hold).

AMDOCS LTD (DOX): Free Stock Analysis Report

HURON CONSLT GP (HURN): Free Stock Analysis Report

INFOSYS LTD (INFY): Free Stock Analysis Report

AT&T INC (T): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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