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Factors To Consider Ahead Of Synchronoss' (SNCR) Q1 Earnings

By Zacks Investment ResearchStock MarketsMay 07, 2019 08:22AM ET
www.investing.com/analysis/factors-to-consider-ahead-of-synchronoss-sncr-q1-earnings-200417907
Factors To Consider Ahead Of Synchronoss' (SNCR) Q1 Earnings
By Zacks Investment Research   |  May 07, 2019 08:22AM ET
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Synchronoss Technologies (NASDAQ:SNCR) is set to report first-quarter 2019 results on May 9.

Notably, the company missed the Zacks Consensus Estimate in three of the trailing four quarters, the average negative earnings surprise being 489.6%.

In the last reported quarter, non-GAAP loss of $2.49 per share lagged the Zacks Consensus Estimate of a loss of 15 cents. Revenues of $82 million also lagged the consensus mark of $86 million.

Synchronoss’ first-quarter 2019 results are expected to benefit from the deals with the likes of Rackspace, British Telecom, Assurant (NYSE:AIZ) and Verizon (NYSE:VZ). The reselling agreements with Rackspace (DXP partnership) and Assurant (white-label Cloud agreement) are expected to drive the top line.

Further, increasing percentage of recurring revenues (83% of total revenues in the fourth quarter) reflects successful transition of Synchronoss from a custom solutions provider to a product and platform-oriented software-as-a-service (SaaS) company.

However, Synchronoss expects margins to remain under pressure in the first quarter despite undertaking several cost-saving initiatives. Additionally, intense competition in cloud from large vendors is expected to hurt the company’s top line in first-quarter 2019.

The Zacks Consensus Estimate for first-quarter 2019 loss has remained steady at 44 cents over the past 30 days. The consensus mark for revenues is pegged at $83.4 million, indicating a decrease of 0.4% from the year-ago quarter’s reported figure.

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.

Synchronoss has a Zacks Rank #2 but 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 three stocks you may want to consider, as our model suggests that these have the right combination of elements to deliver a beat this earnings season.

Synopsis (NASDAQ:SNPS) has an Earnings ESP of +1.15% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Electronic Arts (NASDAQ:EA) has an Earnings ESP of +11.35% and a Zacks Rank #1.

Intuit (NASDAQ:INTU) has an Earnings ESP of +0.59% and a Zacks Rank #2.

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Synchronoss Technologies, Inc. (SNCR): Free Stock Analysis Report

Synopsys, Inc. (SNPS): Free Stock Analysis Report

Intuit Inc. (INTU): Free Stock Analysis Report

Electronic Arts Inc. (EA): Free Stock Analysis Report

Original post

Zacks Investment Research
Factors To Consider Ahead Of Synchronoss' (SNCR) Q1 Earnings
 
Factors To Consider Ahead Of Synchronoss' (SNCR) Q1 Earnings

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