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CooTek (CTK) to Report Q2 Earnings: What's in the Offing?

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CooTek (Cayman) Inc. CTK is slated to release second-quarter 2020 results on Aug 18.

The company expects quarterly revenues of around $120 million. The Zacks Consensus Estimate for the same is also pegged at $119.9 million, calling for growth of a whopping 219%, year on year.

The Zacks Consensus Estimate for quarterly earnings is pinned at a penny, suggesting a significant improvement from the year-ago quarter’s loss per share of 22 cents.

CooTek Cayman Inc. Sponsored ADR Price and Consensus

CooTek Cayman Inc. Sponsored ADR Price and Consensus
CooTek Cayman Inc. Sponsored ADR Price and Consensus

CooTek Cayman Inc. Sponsored ADR price-consensus-chart | CooTek Cayman Inc. Sponsored ADR Quote

The company’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed in the other, the average surprise being 30%.

Let’s see how things have shaped up for the announcement.

Factors at Play

CooTek’s quarterly performance is likely to have benefited from accelerated monetization of its online literature and casual games businesses. Moreover, increased revenue mix of the in-house ad network is expected to have supported revenue and margin growth in to-be-reported quarter.

The company’s sustained focus on rolling out new mobile applications is likely to have helped it in adding new customers, thereby bringing in incremental revenues in the June-end quarter. Its high customer retention ratio is anticipated to have aided top-line growth.

Nonetheless, the company’s bottom-line performance might have been hurt by higher sales and marketing (S&M) expenses mainly due to increased investments in user acquisitions.

What Our Model Says

Our proven model does not predict an earnings beat for CooTek this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

CooTek currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%.

Stocks With Favorable Combinations

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:

Agilent Technologies A has an Earnings ESP of +4.55% and carries a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Autodesk ADSK has an Earnings ESP of +9.26% and carries a Zacks Rank of 3, currently.

Alibaba Group BABA has an Earnings ESP of +7.90% and currently carries a Zacks Rank of 3.

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