Vivint Smart Home (VVNT) Announces Third Quarter Loss, Exceeds Revenue Estimates – November 8, 2022

Vivint smart home (VVNT Free Report) came out with a quarterly loss of $0.19 per share against Zacks consensus estimate of a loss of $0.31. That compares to a loss of $0.52 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents a profit surprise of 38.71%. A quarter ago, this company was expected to post a loss of $0.33 per share when it actually produced a loss of $0.02, delivering a surprise of 93.94%.

In the past four quarters, the company has exceeded consensus EPS estimates four times.

Vivint smart home, which is part of the Zacks Retail – Consumer Electronics industry, reported revenue of $439.37 million for the quarter ended September 2022, beating Zacks’ consensus estimate of 7.10%. That compares to revenues of $386.71 million a year ago. The company has exceeded consensus revenue estimates four times in the past four quarters.

The sustainability of the immediate stock price movement based on recently released numbers and future earnings forecasts will primarily depend on management’s comments on the earnings call.

Vivint Smart Home shares have lost about 27% year-to-date against the -20.1% decline in the S&P 500.

What’s next for Vivint Smart Home?

While Vivint Smart Home has underperformed the market so far this year, the question on investors’ minds is: what’s next for the stock?

There are no easy answers to this key question, but one reliable metric that can help investors answer it is the company’s earnings outlook. This includes not only the current consensus earnings expectations for the upcoming quarter(s), but also how those expectations have changed recently.

Empirical research shows a strong correlation between short-term stock movements and trends in earnings estimate revisions. Investors can track these revisions on their own or rely on a proven scoring tool like Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Before that Press release, the trend of estimate revisions for Vivint Smart Home: favorable. While the magnitude and direction of estimate revisions may change following the release of the company’s earnings report, the current situation translates into a Zacks No. 1 ranking (Strong Buy) for the stock. Thus, stocks are expected to outperform the market in the near future. You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how the estimates for the next few quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.29 on $413.49 million in revenue for the upcoming quarter and -$0.75 on $1.62 billion in revenue for the current fiscal year .

Investors should be aware that the outlook for the sector can also have a significant impact on stock performance. In terms of Zacks industry rankings, Retail – Consumer Electronics is currently in the top 11% of Zacks 250+ industries. Our research shows that the top 50% of industries ranked by Zacks outperform the bottom 50% by a factor of more than 2 to 1.

Another stock in the same sector, Best Buy (BBY Free Report), has not yet reported its results for the quarter ended October 2022. The results are expected to be released on November 22.

This consumer electronics retailer is expected to post quarterly earnings of $1.03 per share in its next report, representing a year-over-year change of -50.5%. The consensus EPS estimate for the quarter remained unchanged for the past 30 days.

Best Buy’s revenue is expected to be $10.29 billion, down 13.6% from the year-ago quarter.

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