Markets
ZG

Discovery (DISCA) Q2 Earnings to Gain on Portfolio Strength

DiscoveryDISCA is scheduled to report second-quarter 2018 results on Aug 7.

In the last reported quarter, the company delivered a positive earnings surprise of 17.78%. Revenues surged 43% year over year to $2.31 billion.

The Zacks Consensus Estimate for second-quarter earnings has remained steady at 84 cents over the last seven days, reflecting year-over-year growth of 23.5%. The consensus mark for revenues currently stands at $2.85 billion, reflecting year-over-year growth of almost 63.5%.

Let's see how things are shaping up for this announcement.

U.S. & International Networks' Top-Line to Grow

Discovery's buyout of Scripps is a positive for the company as its product portfolio has widened significantly. Also, this buyout will help the company strengthen its foothold internationally.

Discovery Communications, Inc. Price and EPS Surprise

Discovery Communications, Inc. Price and EPS Surprise | Discovery Communications, Inc. Quote

The combined entity is likely to produce around 8,000 hours of original programming content on a yearly basis, reaching fans across 220 countries and territories, in 50 different languages.

Moreover, the combined entity is anticipated to generate 7 billion short-form video streams per month, expanding its presence across new video and social media platforms.

Post Scripps Networks' addition, Discovery is expected to have nearly 20% of ad-supported pay-TV audiences' share in the United States.

Further, robust performance is anticipated from Oprah Winfrey Network ("OWN"), Animal Planet, HGTV, Investigation Discovery and TLC.

The U.S. Networks division is projected to perform well in the second quarter, consequently driving top-line growth. The Zacks Consensus Estimate for U.S. Networks revenues is pegged at $1.70 billion, much higher than $890 million reported in the year-ago quarter.

Moreover, the International Networks division is expected to put on a robust performance. The Zacks Consensus Estimate currently stands at $1.14 billion, much higher than $811 million reported in the year-ago quarter.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP . The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.

Discovery is likely to deliver a positive earnings surprise in the second quarter due to a favorable combination of a Zacks Rank #3 and an Earnings ESP of +1.73%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Other Stocks That Warrant a Look

Here are three stocks that you may want to consider as our model shows these too have the right combination of elements to deliver an earnings beat in the to-be reported quarter.

Vishay Intertechnology VSH has an Earnings ESP of +2.41% and a Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here .

Zillow Group ZG has an Earnings ESP of +15.38% and a Zacks Rank #2.

CyberArk CYBR has an Earnings ESP of +3.38% and a Zacks Rank #2.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Zillow Group, Inc. (ZG): Free Stock Analysis Report

CyberArk Software Ltd. (CYBR): Free Stock Analysis Report

Discovery Communications, Inc. (DISCA): Free Stock Analysis Report

Vishay Intertechnology, Inc. (VSH): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

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.

In This Story

ZG CYBR VSH DISCA

Other Topics

Earnings Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More