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CBS Corp. (CBS) Q1 Earnings in Focus: What's in Store?

CBS Corporation CBS is slated to report first-quarter 2017 results on May 4, after the closing bell. The big question lingering in the investor’s mind now is whether the company will be able to keep its earnings streak alive or not.

In the previous quarter, the company reported earnings beat of 0.91%. Notably, the company has surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average earnings beat of 6.2%. Let’s see how things are shaping up prior to this announcement.

Unlikely to Beat Estimates

Our proven model does not conclusively show that CBS is likely to beat earnings estimates 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. The Most Accurate estimate stands at 95 cents, while the Zacks Consensus Estimate is pegged higher at 96 cents. So the ensuing difference – the Earnings ESP – is of -1.04%. The company carries a Zacks Rank #3, which when combined with an ESP of -1.04%, makes an earnings surprise difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

CBS Corporation Price, Consensus and EPS Surprise


CBS Corporation Price, Consensus and EPS Surprise | CBS Corporation Quote

Factors Influencing this Quarter

CBS Corporation’s sustained focus on increasing subscription-based revenues should drive long-term growth. Further, CBS Corp. has an extensive library of premium content that it monetizes over multiple platforms.

In 2016, the company crossed $1 billion mark in revenues from retransmission consent and reverse compensation, a year earlier than anticipated. In 2017, management expects retransmission and reverse compensation to increase 25% from the prior year. Several strategic deals with Sinclair, AT&T, Nexstar and others have positioned CBS Corp. favorably, enabling it to meet the retransmission targets much ahead of schedule.

However, the media industry is highly competitive and CBS Corp. faces intense competition from other broadcast radio and television stations; cable television networks; and motion picture studios. This may weigh on the company’s top-line results.

CBS Corp. has performed almost in line with the Zacks categorized industry in the past six months. The stock has increased roughly 20.1%, while the Broadcasting-Radio/TV industry has gained 20.9%.

Stocks Poised to Beat Earnings Estimates

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

Best Buy Co. Inc. BBY has an Earnings ESP of +12.50% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Lowe's Companies, Inc. LOW has an Earnings ESP of +2.83% and a Zacks Rank #2.

L Brands, Inc. LB has an Earnings ESP of +4.17% and a Zacks Rank #3.

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CBS Corporation (CBS): Free Stock Analysis Report
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L Brands, Inc. (LB): Free Stock Analysis Report
Best Buy Co., Inc. (BBY): Free Stock Analysis Report
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