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Nielsen (NLSN) to Report Q2 Earnings: What's in the Offing?

Zacks Equity Research

Nielsen Holdings NLSN is set to report second-quarter 2019 results on Jul 31.

The company missed estimates in three of the trailing four quarters, delivering average negative earnings surprise of 12.36%. However, in the last reported quarter, its earnings beat the Zacks Consensus Estimate by 4 cents.

First-quarter 2019 reported revenues came in at $1.563 billion, marginally surpassing the Zacks Consensus Estimate of $1.561 billion.

The Zacks Consensus Estimate for second-quarter revenues is currently pegged at $1.62 billion. Moreover, the Zacks Consensus Estimate for earnings per share is pegged at 41 cents.

Let’s see how things are shaping up prior to this announcement.

Nielsen Holdings Plc Price and EPS Surprise


Nielsen Holdings Plc Price and EPS Surprise

Nielsen Holdings Plc price-eps-surprise | Nielsen Holdings Plc Quote

Key Factors to Consider

Nielsen has been strengthening presence in advertising and diary measurement markets through strategic partnerships. This is a major positive for the quarter to be reported.

During the quarter, the company partnered with iHeartMedia, Inc., an audio company in the United States. The deal, expected to expand the reach of Continuous Diary Measurement and boost the momentum of Nielsen's national cross-media planning tool, Nielsen Media Impact (NMI), will likely drive growth in the to-be-reported quarter.

In addition, the company expanded NMI to 19 new markets. The addition of these 19 new markets, which will expand its client reach, is expected to expand top-line growth in the quarter to be reported.

During the quarter, its other innovative services continued to gain traction among TV and media companies. This is likely to accelerate adoption rate, thereby increasing Global Media revenues in the quarter to be reported.

However, sluggish growth in emerging markets could hurt top-line growth in the to-be-reported quarter. Further, ongoing investments in technology and infrastructure remain risks for margin expansion and profitability.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has a good chance of beating estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Currently, Nielsen has a Zacks Rank #3 and an Earnings ESP of +1.38%.Therefore, it has a good chance of beating estimates in the to-be-reported quarter. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.

Other Stocks to Consider

Here are a few other stocks worth considering as our model shows that these too have the right combination of elements to deliver an earnings beat in the upcoming releases.

Groupon, Inc. GRPN has an Earnings ESP of +25.00% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Grubhub Inc. GRUB has an Earnings ESP of +12.04% and a Zacks Rank #3.

Waters Corporation WAT has an Earnings ESP of +0.59% and holds a Zacks Rank #3.

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