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What's in the Offing for Gol Linhas (GOL) in Q3 Earnings?
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Gol Linhas Aereas Inteligentes S.A. is slated to release third-quarter 2018 results on Nov 1, before the market opens.
Last reported quarter, the company incurred a wider-than-expected loss. Moreover, the loss increased year over year. Results were affected by the depreciation of Brazilian Real against the US Dollar among other factors. Meanwhile, the top line was aided by a 10.3% rise in passenger revenues.
The picture for the soon-to-be-reported quarter also looks dismal with the Zacks Consensus Estimate for bottom line in the quarter having declined to a loss of 5 cents per share from earnings of 13 cents, 60 days ago.
Let’s see how things shape up for this announcement.
Factors Likely at Play
Rising fuel prices are expected to hamper Gol Linhas’ bottom line in the third quarter. Additionally, expenses on the labor front might further pressurize the bottom line.
For the quarter to be reported, operating margin is anticipated between 5% and 5.5%, down approximately 7 percentage points (pp) on a year-over-year basis. Also, EBITDA (Earnings before interest, tax, depreciation and amortization) margin is estimated in the 11-11.5% range, lower than the EBITDA margin of 17% in the year-ago period.
However, Gol Linhas’ focus on capacity discipline and revenue management strategies has been driving results. Owing to this tailwind, the company anticipates third-quarter passenger unit revenues (PRASK) to rise in the 4.5-5% range. Unit revenues (RASK) are projected to increase between 4% and 4.5%. These impressive predictions should in turn, boost the top line in the impending quarterly results.
Gol Linhas Aereas Inteligentes S.A. Price and EPS Surprise
Our quantitative model does not conclusively show that Gol Linhas is likely to beat on earnings in the third quarter because a company needs the right combination of the following two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — to increase the odds of an earnings surprise. However, that is not the case here as highlighted below.
Earnings ESP: Gol Linhas has 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.
Zacks Rank: Gol Linhas carries a Zacks Rank of 3, which increases the predictive power of ESP. However, the company’s 0.00% ESP complicates the surprise prediction.
We caution against the Sell-rated stocks (#4 or 5) going into an earnings announcement, especially when the company is witnessing negative estimate revisions.
Stocks to Consider
Investors interested in the broader Transportation sector may consider Frontline Ltd. (FRO - Free Report) , ArcBest Corporation (ARCB - Free Report) and Hertz Global Holdings, Inc (HTZ - Free Report) as these stocks possess the right combination of elements to come up with an earnings beat in their next releases.
Frontline has an Earnings ESP of +11.77% and is a Zacks #3 Ranked player. The company will report third-quarter earnings on Nov 30.
ArcBest has an Earnings ESP of +5.04% and a Zacks Rank #1 (Strong Buy). The company is scheduled to report third-quarter financial numbers on Nov 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hertz Global has an Earnings ESP of +13.48% and a Zacks Rank #2 (Buy). The company will report third-quarter earnings performance on Nov 8.
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What's in the Offing for Gol Linhas (GOL) in Q3 Earnings?
Gol Linhas Aereas Inteligentes S.A. is slated to release third-quarter 2018 results on Nov 1, before the market opens.
Last reported quarter, the company incurred a wider-than-expected loss. Moreover, the loss increased year over year. Results were affected by the depreciation of Brazilian Real against the US Dollar among other factors. Meanwhile, the top line was aided by a 10.3% rise in passenger revenues.
The picture for the soon-to-be-reported quarter also looks dismal with the Zacks Consensus Estimate for bottom line in the quarter having declined to a loss of 5 cents per share from earnings of 13 cents, 60 days ago.
Let’s see how things shape up for this announcement.
Factors Likely at Play
Rising fuel prices are expected to hamper Gol Linhas’ bottom line in the third quarter. Additionally, expenses on the labor front might further pressurize the bottom line.
For the quarter to be reported, operating margin is anticipated between 5% and 5.5%, down approximately 7 percentage points (pp) on a year-over-year basis. Also, EBITDA (Earnings before interest, tax, depreciation and amortization) margin is estimated in the 11-11.5% range, lower than the EBITDA margin of 17% in the year-ago period.
However, Gol Linhas’ focus on capacity discipline and revenue management strategies has been driving results. Owing to this tailwind, the company anticipates third-quarter passenger unit revenues (PRASK) to rise in the 4.5-5% range. Unit revenues (RASK) are projected to increase between 4% and 4.5%. These impressive predictions should in turn, boost the top line in the impending quarterly results.
Gol Linhas Aereas Inteligentes S.A. Price and EPS Surprise
Gol Linhas Aereas Inteligentes S.A. Price and EPS Surprise | Gol Linhas Aereas Inteligentes S.A. Quote
Earnings Whispers
Our quantitative model does not conclusively show that Gol Linhas is likely to beat on earnings in the third quarter because a company needs the right combination of the following two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — to increase the odds of an earnings surprise. However, that is not the case here as highlighted below.
Earnings ESP: Gol Linhas has 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.
Zacks Rank: Gol Linhas carries a Zacks Rank of 3, which increases the predictive power of ESP. However, the company’s 0.00% ESP complicates the surprise prediction.
We caution against the Sell-rated stocks (#4 or 5) going into an earnings announcement, especially when the company is witnessing negative estimate revisions.
Stocks to Consider
Investors interested in the broader Transportation sector may consider Frontline Ltd. (FRO - Free Report) , ArcBest Corporation (ARCB - Free Report) and Hertz Global Holdings, Inc (HTZ - Free Report) as these stocks possess the right combination of elements to come up with an earnings beat in their next releases.
Frontline has an Earnings ESP of +11.77% and is a Zacks #3 Ranked player. The company will report third-quarter earnings on Nov 30.
ArcBest has an Earnings ESP of +5.04% and a Zacks Rank #1 (Strong Buy). The company is scheduled to report third-quarter financial numbers on Nov 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hertz Global has an Earnings ESP of +13.48% and a Zacks Rank #2 (Buy). The company will report third-quarter earnings performance on Nov 8.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>