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Will Cable ONE (CABO) Stock Disappoint this Earnings Season?

Cable ONE Inc.CABO is slated to report fourth-quarter 2016 results on Feb 28, before the market opens.

Over the past three months, shares of Cable ONE gained 8.89% while the Zacks categorized Cable Television industry lost 10.88%.

Last quarter, the company posted a negative earnings surprise of 26.52%. However, the company's earnings surpassed the Zacks Consensus Estimate in three of the previous four quarters, with an average beat of 10.36%.

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

Factors at Play

Cable ONE is among the top 10 cable companies in the U.S., caters to almost 700,000 customers across 19 states. The company provides a wide range of latest products and services that includes wireless Internet service, high-definition programming and phone service with free, unlimited long-distance calling in the continental U.S

Cable ONE made major changes in its channels and their availability to customers. New lineups were implemented to make news, sports and other channels easily accessible to viewers. We are also impressed with the company's efforts to reward shareholders with a quarterly cash dividend of $1.50 per share. The dividend will be paid on Mar 10, to stockholders of record at the close of business on Feb 21.

The company's failure to sign a retransmission consent deal with Northwest Broadcasting took the latter's channels off from its portfolio. Moreover, being a cable TV company, Cable ONE faces immense competition from leading cable multi-service-operators (MSO) in the U.S. like Comcast Corp. CMCSA and Charter Communications Inc. CHTR . These factors are likely to remain as major dampeners for the company.

Earnings Whispers

Our proven model does not conclusively show that Cable ONE 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 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Unfortunately, that is not the case here as elaborated below.

Zacks ESP: Cable ONE has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $4.31. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Zacks Rank: Cable ONE has a Zacks Rank #5 (Strong Sell). Please note that we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Cable One, Inc. Price and EPS Surprise

Cable One, Inc. Price and EPS Surprise | Cable One, Inc. Quote

Key Pick

Here is a company in the Zacks categorized broader Consumer Discretionary sector that has the right combination of elements to post an earnings beat this quarter.

Tribune Media Company TRCO is expected to release its fourth-quarter 2016 earnings on Mar 1. The company has an Earnings ESP of +4.44% and a Zacks Rank #3.You can see the complete list of today's Zacks #1 Rank stocks here . Tribune Media's earnings surpassed the Zacks Consensus Estimate in two of the previous four quarters.

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Charter Communications, Inc. (CHTR): Free Stock Analysis Report

Cable One, Inc. (CABO): 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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