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Media Stock Earnings Lineup for Feb 6: NWSA, WWE, LGF.A

Aniruddha Ganguly

Media companies are witnessing a mixed earnings season. Streaming giant Netflix NFLX beat its global subscriber addition target in the fourth quarter of 2019, primarily owing to a strong content portfolio amid increasing competition from newly launched services — Disney + and Apple TV+.

Disney DIS reported an impressive first-quarter fiscal 2020, driven by strong top-line performance by the Studio Entertainment segment and Disney+, which garnered 26.5 million subscribers since its launch on Nov 12.

Meanwhile, legacy media giants like Comcast CMCSA and Charter Communications CHTR continued to lose voice, video and Pay TV subscribers due to persistent cord-cutting and stiff competition from streaming services like Netflix, Hulu, HBO, Disney+, Apple TV+ and Amazon Prime.

Moreover, increasing programming costs and retransmission fees are dragging down the profitability of industry participants.

However, these factors were somewhat negated by increasing demand for high-speed Internet service. Also, increasing investments in original content and focus on providing quality entertainment helped media companies generate favorable results.  

For instance, Comcast lost 149K video customers and 2K voice customers in the fourth quarter of 2019. Nevertheless, the cable giant added 442K high-speed Internet customers.

Moreover, Charter lost 105K video customers in the third quarter. However, residential and SMB Internet net additions were 339K in the reported quarter.

Sneak Peek Into a Few Upcoming Releases

Let us take a look at three media companies set to report on Feb 6.

New York-based News Corporation’s NWSA second-quarter fiscal 2020 results are expected to reflect the negative impact of declining advertising revenues at the News and Information Services segment.

Also, currency remains a major headwind, which has been significantly marring the company’s top and bottom-line performance.

Moreover, the company has an unfavorable combination of a Zacks Rank #4 (Sell) and an Earnings ESP of +15.39%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Notably, per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for News Corporation’s second-quarter earnings is pegged at 13 cents per share, up 18.2% over the past 30 days. (Read More: How News Corporation Looks Just Ahead of Q2 Earnings)
 

News Corporation Price and EPS Surprise

News Corporation Price and EPS Surprise

News Corporation price-eps-surprise | News Corporation Quote

 

Stamford, CT-based World Wrestling Entertainment’s WWE subscriber base is expected to have declined in the fourth quarter. Management expects average paid subscribers of approximately 1.43 million for the fourth quarter, which indicates a decline of 10% from the year-ago period.

Apart from this, a decline in ticket sales during live events or a drop in the number of live events remains a concern.

Moreover, the company is unlikely to report a beat this season as it has an unfavorable combination of an Earnings ESP of 0.00% and a Zacks Rank #3.

Further, the Zacks Consensus Estimate for fourth-quarter earnings declined 11.3% to 71 cents per share over the past 30 days. (Read More: Things to Note Ahead of World Wrestling's Q4 Earnings)
 

World Wrestling Entertainment, Inc. Price and EPS Surprise

World Wrestling Entertainment, Inc. Price and EPS Surprise

World Wrestling Entertainment, Inc. price-eps-surprise | World Wrestling Entertainment, Inc. Quote

 

Santa Monica, CA-based Lionsgate’s LGF.A third-quarter fiscal 2020 results are expected to have benefited from increased premium programming and Starz subscriber growth. The partnerships with Amazon in the U.K. and Airtel in India are key positives.

However, continued investment in Starz is expected to have hurt profitability in the to-be-reported quarter.

Additionally, Lionsgate has an unfavorable combination of an Earnings ESP of 0.00% and a Zacks Rank #3.

The consensus mark for earnings stayed at 17 cents over the past 30 days.

 

Lions Gate Entertainment Corp. Price and EPS Surprise

Lions Gate Entertainment Corp. Price and EPS Surprise

Lions Gate Entertainment Corp. price-eps-surprise | Lions Gate Entertainment Corp. Quote

 

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The Walt Disney Company (DIS) : Free Stock Analysis Report
 
Netflix, Inc. (NFLX) : Free Stock Analysis Report
 
Comcast Corporation (CMCSA) : Free Stock Analysis Report
 
Charter Communications, Inc. (CHTR) : Free Stock Analysis Report
 
World Wrestling Entertainment, Inc. (WWE) : Free Stock Analysis Report
 
Lions Gate Entertainment Corp. (LGF.A) : Free Stock Analysis Report
 
News Corporation (NWSA) : Free Stock Analysis Report
 
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