The Zacks Analyst Blog Highlights: Leap Wireless International, MetroPCS
Communications, Sprint Nextel, Verizon Communications and AT&T
CHICAGO, Nov. 6, 2012
CHICAGO, Nov. 6, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include Leap Wireless International Inc.
(Nasdaq:LEAP), MetroPCS Communications Inc. (NYSE:PCS), Sprint Nextel Corp.
(NYSE:S), Verizon Communications Inc. (NYSE:VZ) and AT&T Inc. (NYSE:T).
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from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Monday's Analyst Blog:
Earnings Preview: Leap Wireless
Leap Wireless International Inc. (Nasdaq:LEAP) is slated to release its
third-quarter 2012 financial results on Wednesday, November 7, before the
opening bell. The Zacks Consensus Estimate for the quarter is pegged at a loss
of 76 cents, representing an annualized growth of 15.32%.
With respect to earnings surprises, Leap Wireless has underperformed the Zacks
Consensus Estimate in three of the last four quarters with an average of
Second Quarter Recap
On August 6, Time Warner reported its second-quarter 2012 financial results.
GAAP net loss, in the second quarter of 2012, was $41.6 million or a loss of
$0.54 per share compared with $65.2 million or $0.85 per share in the
prior-year quarter. Quarterly earnings per share of a loss of $0.54 were
higher than the Zacks Consensus Estimate of a loss of $0.52.
Quarterly total revenue was $786.8 million, up 3.5% year over year, but well
below the Zacks Consensus Estimate of $839 million. In the second quarter of
2012, operating loss was $31.6 million compared with $12.3 million in the
prior-year quarter. Quarterly adjusted OIBDA was $190.8 million, up 18.8% year
Agreement of Estimate Revisions
In the last 30 days, out of the total 19 estimates, three were revised upward
while two moved in the opposite direction for the third quarter of 2012.
However, for the fourth quarter of 2012, out of the total 18 estimates, only
one upward revision was witnessed, while three moved downward over the same
For 2012, out of the total 18 estimates, two were revised upward while three
witnessed downward revisions, over the past one month. The upward estimate
revision continues for 2013, where out of the 19 estimates, four were revised
upward, while one moved in the opposite direction over the same period.
Magnitude of Estimate Revisions
Over the last 30 days, the current Zacks Consensus Estimate has remained
unchanged for the third quarter of 2012 while it decreased by a penny to a
loss of $1.22 for the fourth quarter of 2012. Alike the fourth quarter, the
current Zacks Consensus Estimate also fell by a penny for 2012 over the last
30 days, while the estimate decreased by 4 cents to $3.07 for 2013 over the
same time frame.
Leap Wireless remains one of the low-cost prepaid wireless service providers
in the U.S, and offers a range of cheap service plans including its popular
Muve Music service thus enabling the company to attract young customers. The
company is focusing on upgrading its existing customers by selling
Android-based smartphones, which in turn, will not only drive the company's
top-line sales but also contribute to customer retention as well as customer
However, the major concern for Leap Wireless is the growing competition in the
U.S. low-cost prepaid wireless phone market. Traditionally, the company
competes with the likes of MetroPCS Communications Inc. (NYSE:PCS), Boost
Mobile, the prepaid subsidiary of Sprint Nextel Corp. (NYSE:S) and Tracfone.
Recently, the two largest nationwide carriers, viz., Verizon Communications
Inc. (NYSE:VZ) and AT&T Inc. (NYSE:T) entered the wireless prepaid phone
market after the growth rate of lucrative postpaid wireless market subdued.
We maintain our long-term Neutral recommendation on Leap Wireless
International. Currently, the company retains a Zacks #3 Rank, implying a
short-term Hold rating.
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