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Will DISH Network (DISH) Q3 Earnings Disappoint Investors?

DISH Network Corp.DISH is slated to report its third-quarter 2015 quarterly numbers before the opening bell on Nov 9.

Last quarter, DISH Networkdelivered a positive earnings surprise of 52.17%. Moreover, the company's earnings have surpassed the Zacks Consensus Estimate in three of the previous four quarters, with an impressive average beat of 54.45%. Let's see how things are shaping up for this announcement.

Factors Likely to Influence this Quarter

Over the last couple of years, the internal dynamics of the U.S. pay-TV industry have been gradually shifting from cable and satellite TV operators to low-cost over-the-top service providers. The strong presence of online video streaming providers is proving to be a significant threat for the existing pay-TV business model, with DISH Network being no exception to this risk.

Moreover, in Aug 2015, U.S. telecom regulator Federal Communications Commission (FCC) unanimously voted against DISH Network's claim of a $3.3 billion discount on its total bid to acquire airwaves in the recently concluded AWS-3 spectrum auction. This is undoubtedly a major setback for the company, which has developed a strong portfolio of wireless airwaves over the last 2-3 years. Also, recently, DISH Network's affiliates - Northstar Wireless and SNR Wireless - gave up 197 spectrum licenses worth $3.3 billion to the FCC on being denied the discount. Moreover, the affiliates had to pay a penalty of $413 million to the FCC for failing to make the payment within the stipulated period.

Earnings Whispers

Our proven model does not conclusively show that Dish Networkis 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: Dish Networkhas an earnings ESP of -5.00%. This is because the Most Accurate estimate is 38 cents while the Zacks Consensus Estimate is pegged higher at 40 cents.

Zacks Rank: DISH Networkhas a Zacks Rank #3 which increases the predictive power of ESP. However, we need to have a positive ESP to be confident of an earnings surprise.

Stocks to Consider

Here are some companies you may want to consider instead as our model shows these have the right combination of elements to post an earnings beat this quarter:

Time Warner Cable Inc. TWC , an earnings ESP of +0.56% and a Zacks Rank #3.

AMC Networks Inc. AMCX , an earnings ESP of +2.30% and a Zacks Rank #1.

Scripps Networks Interactive, Inc. SNI , an earnings ESP of +1.03% and a Zacks Rank #2.

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DISH NETWORK CP (DISH): Free Stock Analysis Report

SCRIPPS NETWRKS (SNI): Free Stock Analysis Report

TIME WARNER CAB (TWC): Free Stock Analysis Report

AMC NETWORKS- A (AMCX): 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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