ViacomCBS VIAC is set to report fourth-quarter 2021 results on Feb 15.

For the quarter, the Zacks Consensus Estimate for earnings has moved southward by 2.56% to 38 cents per share in the past 30 days. The figure indicates a 63.5% decline from the year-ago quarter’s reported figure.

The consensus mark for revenues is pegged at $7.47 billion, calling for an 8.7% increase from the year-ago quarter’s reported figure.

The company’s earnings beat the Zacks Consensus Estimate in three of the past four quarters and meeting in the other. ViacomCBS has a trailing four-quarter earnings surprise of 7.15%, on average.

Let’s see how things have shaped up for this announcement.

 

Factors to Consider

ViacomCBS’ fourth-quarter results are expected to have benefited from a solid cable network portfolio. The growing traction of Showtime, BET, Comedy Central and Nickelodeon is expected to have boosted the top line.

During the to-be-reported quarter, Paramount+ witnessed its most successful week ever. It added one million new subscribers and set a new record for total signups since its rebrand. The service registered a new record for the highest level of subscriber engagement and most hours streamed.

Subscriber acquisition, expansion plans and the consumption on Paramount+ fueled by a diverse global content offering have been key catalysts. Paramount+ features a content catalog of more than 30,000 episodes, 2,500 movie titles and over 1,000 live sporting events.

Improvement in the ad-spending environment, driven by the return of live sports globally, is expected to have been a key catalyst in driving ad revenues, contributing 28% to the company’s top line in the third quarter.

An expanding content catalog of live sporting events and a solid portfolio of streaming services (both advertising and subscription-based offerings), including CBS All Access, Showtime OTT, Pluto TV, Noggin and BET+, are expected to have bumped up viewership and ad revenues in the fourth quarter.

Pluto TV gained immense popularity with more than 250 live linear channels and thousands of hours of on-demand content. Pluto TV partners with more than 175 content providers, including media houses, film and TV studios that help it produce various content.

Pluto TV’s total global monthly active users (MAUs) were 54.4 million and revenues surged 99% year over year. This momentum is expected to have continued in the to-be-reported quarter.

Theatrical revenues of ViacomCBS are expected to have taken a hit in the reported quarter due to a reduction in the capacity of movie theaters in response to the pandemic.

Q4 Development

In the to-be-reported quarter, ViacomCBS announced its partnership with CJ ENM. The deal enables co-productions for original films and series and content licensing and distribution across ViacomCBS’ and CJ ENM’s leading streaming services. As part of the deal, Paramount+ is set to debut in South Korea in 2022 as an exclusive bundle with CJ ENM’s streaming service, TVING. This will mark ViacomCBS’ first entry into an Asian market.

On Nov 9, ViacomCBS renewed its CBS Television Network Affiliate Agreements with Gray Television. As part of the multi-year agreement, Gray’s CBS affiliates will continue to be available locally to subscribers on Paramount+ and vMVPD platforms

What Our Model Says

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. But that’s not the case here.

ViacomCBS has an Earnings ESP of -2.73% and carries a Zacks Rank #3 currently. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:

Crocs CROX has an Earnings ESP of -1.26% and a Zacks Rank #3. The company is set to announce fourth-quarter fiscal 2021 results on Feb 16. You can see the complete list of today’s Zacks #1 Rank stocks here.

CROX is up 20.2% in the past year against the Zacks Textile – Apparel industry’s decline of 9.8% and the Consumer Discretionary sector’s fall of 22.4% in the past year.

Cedar Fair FUN has an Earnings ESP of +6.02% and a Zacks Rank #1. The company is set to announce fourth-quarter 2021 results on Feb 16.

FUN is up 43.5% in the past year against the Zacks Leisure and Recreation Services industry’s return of 0.5% and the Consumer Discretionary sector’s fall of 22.4%.

Gildan Activewear GIL has an Earnings ESP of 9.57% and a Zacks Rank #2. The company is set to announce fourth-quarter 2021 results on Feb 23.

GIL is up 38.5% in the past year against the Zacks Textile – Apparel industry’s decline of 9.8% and the Consumer Discretionary sector’s fall of 22.4%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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