Will GameStop (GME) Miss Earnings? - Analyst Blog

GameStop Corporation GME is slated to report its fourth-quarter fiscal 2013 results on March 27, 2014. In the last quarter, this video game and entertainment software retailer posted earnings of 58 cents a share that came in line with the Zacks Consensus Estimate. Let's see how things are shaping up for this announcement.

Factors This Past Quarter

GameStop delivered strong third-quarter fiscal 2013 results on the back of robust sales of new titles such as Grand Theft Auto V., healthy digital and mobile business performance and gain in market share. The quarterly earnings met the Zacks Consensus Estimate and surged 52.6% from the year-ago quarter.

Earnings Whispers?

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

Zacks ESP: ESP for GameStop is 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate stand at $1.92.

Zacks Rank #4 (Sell): GameStop's Zacks Rank #4 (Sell) when combined with a 0.00% ESP makes surprise prediction difficult. We caution against stocks with Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Stocks That Warrant a Look

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

Foot Locker, Inc. FL has an Earnings ESP of +1.92% and a Zacks Rank #2 (Buy).

G-III Apparel Group, Ltd. GIII has an Earnings ESP of +4.26% and a Zacks Rank #2 (Buy).

Accenture plc ACN has an Earnings ESP of +1.92% and a Zacks Rank #2 (Buy).