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What's in the Cards for TiVo (TIVO) this Earnings Season?

TiVo CorporationTIVO is slated to report first-quarter 2017 results on May 3. It should be noted that TiVo Corporation was formerly known as Rovi Corporation. Upon successfully completing the acquisition of TiVo Inc. in Sep 2016, Rovi adopted the iconic TiVo brand name.

Notably, this will be the company's third combined quarterly results. In the previous two quarters, TiVo reported better-than-expected earnings once and missed the same in one occasion.

Let us see how things are shaping up for the third quarterly results of the combined company.

Factors to Consider

Prior to the acquisition, Rovi used to provide a set of solutions that allowed businesses to protect, enable and distribute digital goods to consumers, helping them discover and manage digital media across multiple channels. On the other hand, TiVo Inc. pioneered a brand new category of products by developing the first commercially available digital video recorder. However, over the years, the company expanded its capabilities beyond hardware sales and patent licensing to online subscription services.

Therefore, the merger has brought together two leading players in the media entertainment industry, with complementary products and services, as well as a number of patented technologies. The new TiVo Corporation has now become a global leader in entertainment technology and audience insights. The company has a diverse product portfolio that ranges from interactive program guide to the DVR. The combined company has emerged as the world's leading media and entertainment provider to deliver the ultimate entertainment experience.

Similar to the previous two quarter's results, we expect the combined company's first-quarter revenues to witness positive impact from the merger. Notably, in the last two quarters, TiVo registered 33.3% and 68.7% year-over-year jump in revenues, respectively.

Furthermore, TiVo's to-be-reported quarterly results are likely to benefit from a series of deals signed with streaming video giant - Netflix Inc. NFLX - in third-quarter 2016.

However, intense competition, particularly from companies like Dish Network and Cablevision Systems Corp., is eroding TiVo's subscriber base. This may adversely affect TiVo's first-quarter results.

TiVo Corporation Price and EPS Surprise

TiVo Corporation Price and EPS Surprise | TiVo Corporation Quote

Earnings Whispers

Our proven model does not conclusively show that TiVo is likely to beat the Zacks Consensus Estimate in its upcoming release. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Unfortunately, this is not the case here as elaborated below.

Zacks ESP: The Earnings ESP for TiVO is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 14 cents. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Zacks Rank: TiVo carries a Zacks Rank #3. Though Zacks Rank #1, 2 or 3 increases the predictive power of ESP, the company's ESP of 0.00% makes surprise prediction difficult.

We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some companies which, as per our model, have the right combination of elements to post an earnings beat this quarter:

AMTEK Inc. AME , with an Earnings ESP of +1.79% and a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here .

Apple Inc. AAPL , with an Earnings ESP of +1.00%, and a Zacks Rank #3.

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Netflix, Inc. (NFLX): Free Stock Analysis Report

TiVo Corporation (TIVO): Free Stock Analysis Report

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AMTEK, Inc. (AME): 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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