EPAM Systems (EPAM) to Report Q4 Earnings: What's in Store?
EPAM Systems EPAM is scheduled to report fourth-quarter 2021 results on Feb 17.
EPAM projects fourth-quarter revenues between $1.075 billion and $1.085 billion (mid-point $1.08 billion), suggesting year-over-year growth of 49% at the mid-point. The Zacks Consensus Estimate for the same is pegged at $1.08 billion, suggesting growth of 49.8% from the year-ago reported figure.
Management projects non-GAAP earnings to be $2.44-$2.51 per share. The consensus mark for earnings stands at $2.50 per share, indicating an increase of 38.1% from $1.81 reported in the year-ago period.
EPAM’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 7.2%.
EPAM Systems, Inc. Price and EPS Surprise
EPAM Systems, Inc. price-eps-surprise | EPAM Systems, Inc. Quote
Factors to Note
EPAM’s fourth-quarter performance is likely to have benefited from strong demand for its services, driven by accelerated digital modernization across several industries in continued response to economic changes post COVID-19.
EPAM expects its largest industry vertical, Business Information & Media, to bounce back on the travel and hospitality sector rebound and recovery to pre-COVID levels. In the third quarter, this segment had accounted for 17.5% of total revenues.
In the fourth quarter, EPAM expects a revenue contribution of 8% from acquisitions, including Emakina. Management anticipates non-GAAP income from operations to be 17-18%.
Foreign exchange fluctuations may have a negligible negative impact on revenue growth, according to management. Specifically, foreign exchange is likely to result in a loss of $1.5 million in the quarter to be reported.
However, the company expects fewer new customer additions than witnessed in the third quarter. Also, supply chain constraints are predicted to have weighed on EPAM’s fourth-quarter performance.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for EPAM 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.
EPAM currently has a Zacks Rank #3 and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Stocks With Favorable Combinations
Per our model, Cushman & Wakefield CWK, Tempur Sealy International TPX and Jones Lang LaSalle JLL have the right combination of elements to post an earnings beat in their upcoming releases.
Cushman & Wakefield has a Zacks Rank #1 and an Earnings ESP of +6.45%. The company is scheduled to report fourth-quarter 2021 results on Feb 24. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 110.3%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for the fourth-quarter earnings of Cushman & Wakefield is pegged at 62 cents per share, suggesting year-over-year growth of 44.2%. The consensus mark for revenues stands at $2.66 billion, indicating a decline of 17.1% year over year.
Tempur Sealy International is slated to report fourth-quarter 2021 results on Feb 22. The stock has a Zacks Rank #2 and an Earnings ESP of +1.82%. Its earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 22.4%.
The Zacks Consensus Estimate for Tempur Sealy International’s quarterly earnings stands at 96 cents per share, suggesting a year-over-year improvement of 43.3%. Its quarterly revenues are estimated to increase 37.8% year over year to $1.46 billion.
Jones Lang LaSalle has a Zacks Rank #2 and an Earnings ESP of +9.23%. The company is scheduled to report fourth-quarter 2021 results on Feb 28. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 128.7%.
The Zacks Consensus Estimate for Jones Lang LaSalle s’ fourth-quarter earnings is pegged at $6.68 per share, suggesting year-over-year growth of 26.3%. The consensus mark for revenues stands at $5.51 billion, indicating a year-over-year improvement of 13.7%.
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