Will Cinemark Holdings (CNK) Earnings Surprise This Quarter? - Analyst Blog

Cinemark Holdings Inc. (CNK) is set to release second-quarter 2014 results before the opening bell on Aug 5, 2014.

 

In the last quarter, the company delivered a 10.71% earnings surprise with an average beat of 5.99% in the last four quarters. Let's see how things are shaping up for this announcement.

 

Factors to be Considered this Quarter

 

Cinemark is poised for better financial results mainly on hit movie releases this summer. Moreover, strong presence in both the domestic and international markets will further drive the company's top line while moving ahead. 

 

However, volatility in the movie industry, increasing maintenance costs and stiff competition from other theatrical and low-cost video streaming companies will continue to hurt profitability.

 

Earnings Whispers 

 

Our proven model does not conclusively show that Cinemark is likely to beat the Zacks Consensus Estimate this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here, as you will see below

 

Negative Zacks ESP: This is because the Most Accurate Estimate is pegged at 46 cents while the Zacks Consensus Estimate is higher at 49 cents. This leads to an ESP of -6.12% for Cinemark.

 

Zacks Rank: Cinemark's Zacks Rank #3 decreases the predictive power of ESP.

 

However, we caution investors against the stock going into the earnings announcement, as an ESP of 0.00% combined with a Zacks Rank #3 lowers the possibility of an earnings surprise.

 

 

Other Stocks to Consider

 

Here are some other companies to consider as our model shows they have the right combination of elements to post an earnings beat this quarter.

 

Dish Network Corp. (DISH) has an Earnings ESP of +15.39% and a Zacks Rank #3.

 

Cablevision Systems Corporation (CVC) has an Earnings ESP of +33.33% and a Zacks Rank #3.

 

 

Digital Cinema Destinations Corp. (DCIN) has an earnings ESP of +66.67% and a Zacks Rank #3.