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Will Thomson Reuters (TRI) Beat Q1 Earnings Estimates?

Thomson Reuters Corporation TRI is slated to report first-quarter 2016 results on Apr 26.

Notably, in the previous three out of four quarters, the company surpassed the Zacks Consensus Estimate with a positive earnings surprise of 5.5%. However, it remains to be seen if the company will be able to keep its positive earnings surprise alive.Let’s see how things are shaping up for this announcement.

Why a Likely Positive Surprise?

Our proven model shows that Thomson Reuters is likely to beat earnings because it has the right combination of the two key ingredients.

Zacks ESP: Thomson Reuters currently has an Earnings ESP of +6.82%. This is because the Most Accurate estimate of 47 cents stands above the Zacks Consensus Estimate of 44 cents. A favorable ESP is a meaningful and leading indicator of a likely positive earnings surprise.

Zacks Rank: Thomson Reuters holds a Zacks Rank #2 (Buy). Note that stocks with a Zacks Rank #1 (Strong Buy), 2 or 3 (Hold) have a significantly higher chance of beating earnings.

The combination of Thomson Reuters’ favorable Zacks Rank and positive ESP make us reasonably confident of an earnings beat.

What is Driving the Better-than-Expected Earnings?

Thomson Reuters has been delivering better-than-expected earnings for three consecutive quarters now. Further, management remains optimistic about the company’s future performance, given its constant endeavors to implement core strategies and progress toward achieving its financial goals. We believe that the company’s cost-containment efforts, share buyback plan and impressive performance of its underlying subscription revenues (which account for most of the total revenue) bode well.

Thomson Reuters remains focused on its financial objectives. The company has been working tirelessly to achieve its earnings target for 2017. The company also intends to keep improving its, free cash flow per share as it did in 2015. Further, the company continues to boost its organic growth via strategic investments in its highest growth market.

Stocks that Warrant a Look

Here are some other companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:

Beacon Roofing Supply, Inc. BECN has an Earnings ESP of +23.8% and a Zacks Rank #2.

Coca-Cola Enterprises, Inc. CCE has an Earnings ESP of +2.50% and a Zacks Rank #2.

Cabela's Incorporated CAB has an Earnings ESP of +10.81% and a Zacks Rank #2.

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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
THOMSON REUTERS (TRI): Free Stock Analysis Report
 
COCA-COLA ENTRP (CCE): Free Stock Analysis Report
 
BEACON ROOFING (BECN): Free Stock Analysis Report
 
CABELAS INC (CAB): Free Stock Analysis Report
 
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