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What's in Store for DISH Network (DISH) This Earnings Season?

Zacks Equity Research

DISH Network DISH is set to report first-quarter 2019 results on May 3.

The company’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, the average positive surprise being 8.9%.

DISH’s subscriber loss increased in the last reported quarter. The company lost 334,000 Pay-TV subscribers against the addition of 39,000 in the year-ago quarter. The unavailability of Univision channels and AT&T’s T  HBO accounted for the loss of more than half of the net subscriber.

Meanwhile, the Zacks Consensus Estimate for first-quarter earnings has remained steady at 65 cents over the past 30 days, indicating a decline of 7.1% from the year-ago quarter’s reported figure.

The consensus mark for revenues currently stands at $3.19 billion, suggesting a decline of 7.1% from the figure reported in the year-ago quarter.

DISH Network Corporation Price and EPS Surprise


DISH Network Corporation Price and EPS Surprise | DISH Network Corporation Quote

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

Key Factors to Consider

DISH’s efforts to diversify its business from being a pure-play satellite-TV operator to an Internet TV operator are yet to provide any meaningful impetus to its growth prospects.

The company continues to struggle with the persistent loss of subscribers due to stiff competition and cord-cutting in the Pay-TV industry. DISH is losing Pay-TV subscribers to online video streaming and on-demand content providers such as Netflix, Amazon Prime, Hulu and YouTube, among others.

These factors are expected to hurt subscriber growth in the soon-to-be-reported quarter.
Moreover, continuing dispute with AT&T is likely to negatively impact churn rate. In fact, DISH expects more subscriber loss in the near term due to the unavailability of HBO’s hit show Game of Thrones.

Notably, DISH settled disputes with Univision in the quarter, but this is expected to have no material impact on the to-be-reported quarter’s results.

Although increasing Sling TV subscriber base is a key catalyst, stiff competition in the streaming space is making it difficult for the service to negate decline in the satellite TV business. Moreover, escalating programming and content expenses along with retransmission fees are anticipated to keep margins under pressure in first-quarter 2019.

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. Meanwhile, Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.

DISH 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 That Warrant a Look

Here are couple stocks you may want to consider, as our model shows that these have the right combination of elements to deliver an earnings beat this earnings season.

Electronic Arts EA has an Earnings ESP of +16.29% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

SeaWorld Entertainment SEAS has an Earnings ESP of +16.13% and a Zacks Rank #2.

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