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ViacomCBS (NasdaqGS:VIAC) Q3 2020 Earnings Prep

in EARNINGS/INVESTING IDEAS by

ViacomCBS Inc. (NasdaqGS:VIAC) is scheduled to report Q3 earnings results on November 6, 2020.

The company is expected to report earnings of $0.81/share on revenue of $5.974 billion. The consensus earnings per share (EPS) of $0.81/share is based on a poll of 22 analysts and represents a decline in eps of −14.4% over the same quarter last year, when the company reported earnings of $0.95/share.

The revenue forecast of $5.974 billion based on a poll of 20 analysts implies a year-over-year (YoY) growth in revenue of 81.3%. Last year the company reported $3.295 billion in revenue for the quarter.

Expected to report EPS contraction of −14.4% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $5,973.92 $3,295.00 81.3%
EPS $0.81 $0.95 −14.4%

Earnings Call Trends

Historically, management has exceeded analyst expectations 5 out of the last 8 tracked quarters, missed 2 quarters, and met expectations 1 quarter.

What are your expectations from ViacomCBS Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.92 $1.25 36.2% Beat
Q1, 2020 $0.95 $1.13 19.1% Beat
Q4, 2019 $1.40 $0.97 −30.9% Missed
Q3, 2019 $0.91 $0.95 3.9% Beat
Q2, 2019 $1.13 $1.16 2.8% Beat
Q1, 2019 $1.37 $1.37 0% Met
Q4, 2018 $1.53 $1.50 −1.9% Missed
Q3, 2018 $1.21 $1.24 2.1% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price did not react much to the update.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 6, 2020 $26 $26.21 0.8% Increase
May 7, 2020 $14.88 $18.08 21.5% Increase
February 20, 2020 $35.67 $28.26 −20.8% Decline
November 12, 2019 $39.18 $36.85 −5.9% Decline

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −1.15, the model suggests that the company is likely an earnings manipulator. A value of −1.15 implies a 12.5% chance of earnings manipulation.

Fundamentals And Technical Analysis

ViacomCBS Inc. is currently trading at $28.57/share, up 1.6% for the day. The company is trading at approximately 66.4% of its 52-week high of $43.04/share. The company’s stock price is up 9.0% since the last earnings report and down −2.4% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 48.18 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NasdaqGS:VIAC Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 13.19 and a forward P/E multiple of 6.86.

ViacomCBS Inc.’s current share price also implies a price-to-book (P/B) multiple of 1.27. The following table summarizes some other key fundamental ratios:

Data as of November 1, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $28.57
P/E Ratio 13.2x
P/E Ratio (Fwd) 6.9x
PEG Ratio −0.2
Total Debt / Total Capital 54.4%
Levered Free Cash Flow $849 million
EV / EBITDA 8.3x

Finbox

ViacomCBS Inc. is a large-cap stock with a market capitalization of $17.668 billion and a total enterprise value of $38.214 billion. The company operates in the Communication Services sector and the Media industry.

ViacomCBS Inc. operates as a media and entertainment company worldwide. The company operates in four segments: TV Entertainment, Cable Networks, Filmed Entertainment, and Publishing. The TV Entertainment segment distributes a schedule of news and public affairs broadcasts, and sports and entertainment programming; produces, acquires, and/or distributes programming, including series, specials, news, and public affairs; operates online content networks for information and entertainment; and streaming subscription services. This segment also operates CBS Sports Network, a 24/7 cable program service that provides college sports and related content, as well as broadcast television stations. The Cable Networks segment creates and acquires programming for distribution and viewing on various media platforms, including subscription cable networks, subscription streaming, basic cable networks, international broadcast networks, and free streaming TV platform, as well as for licensing to third parties. The Filmed Entertainment segment develops, produces, finances, acquires, and distributes films, television programming, and other entertainment content. The Publishing segment publishes and distributes adult and children’s consumer books in printed, digital, and audio formats; develops special imprints and publishes titles based on the products of the company, as well as of third parties; and distributes products for other publishers. This segment also delivers content; and promotes its products on its Websites, social media, and general Internet sites, as well as those related to individual titles. The company was formerly known as CBS Corporation and changed its name to ViacomCBS Inc. in December 2019. ViacomCBS Inc. was founded in 1986 and is headquartered in New York, New York.

Expertise: financial technology, analyzing market trends. Brian is a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to research stock fundamentals. Brian’s background is in physics & computer science and previously worked as a software engineer at GE Healthcare. He enjoys applying his expertise in technology to help find market trends that impact investors. Brian can be reached at brian@finbox.io or at +1 (516) 778-6257.

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