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What's in Store for OneMain Holdings (OMF) in Q3 Earnings?

Zacks Equity Research

OneMain Holdings, Inc. OMF is slated to report third-quarter 2019 results on Oct 28, after the market closes. Its earnings and revenues for the to-be-reported quarter are expected to rise year over year.

In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate. Results were aided by growth in revenues and lower expenses.

The company boasts an impressive earnings surprise history. Its earnings surpassed the consensus estimate in all of the trailing four quarters, the average beat being 7.7%.

OneMain Holdings, Inc. Price and EPS Surprise

OneMain Holdings, Inc. Price and EPS Surprise

OneMain Holdings, Inc. price-eps-surprise | OneMain Holdings, Inc. Quote

However, activities of the company in the third quarter failed to encourage analysts to revise earnings estimates upward. Thus, the Zacks Consensus Estimate for its earnings of $1.58 for the to-be-reported quarter has been unchanged over the past seven days. Nevertheless, it indicates rise of 20.6% from the year-ago quarter’s reported figure.

The consensus estimate for sales is pegged at $790.2 million, indicating growth of 11.9% from the year-ago quarter’s reported figure.

Key Estimates for Q3

The Zacks Consensus Estimate for net finance receivables held for investment is pegged at $17.8 billion for the third quarter, which indicates 4.6% growth sequentially. Moreover, the consensus estimate for average net receivables of $17.1 billion suggests rise of 3.4% from the prior quarter’s reported figure.

Thus, supported by growth in net finance receivables, the company’s interest income is expected to have risen in the quarter, thereby aiding top-line growth.

However, overall expenses are likely to have remained elevated in the third quarter mainly due to continued increase in salaries and benefits costs.

Earnings Whispers

Now, let’s check what our quantitative model predicts.

According to our quantitative model, chances of OneMain Holdings beating the Zacks Consensus Estimate in the third quarter are low. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for OneMain Holdings is -1.38%.

Zacks Rank: The company currently sports a Zacks Rank #1 (Strong Buy).

Stocks That Warrant a Look

Here are some finance stocks that you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat this quarter.

Santander Consumer USA Holdings Inc SC is slated to release results on Oct 30. It presently has an Earnings ESP of +1.01% and a Zacks Rank #3.

Cullen/Frost Bankers, Inc CFR is slated to release results on Oct 31. It currently has an Earnings ESP of +0.07% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Banco Macro S.A. BMA is expected to release results on Nov 26. It has an Earnings ESP of +12.20% and a Zacks Rank #3 at present.

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Macro Bank Inc. (BMA) : Free Stock Analysis Report
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OneMain Holdings, Inc. (OMF) : Free Stock Analysis Report
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