The Zacks Analyst Blog Highlights: LinkedIn, GoPro, Silicon Motion Technology, Fluor and Andersons

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Jul 31, 2014, 09:30 ET

CHICAGO, July 31, 2014 /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 the LinkedIn Corp. (NYSE:LNKD-Free Report), GoPro, Inc. (Nasdaq:GPRO-Free Report), Silicon Motion Technology Corp (Nasdaq:SIMO-Free Report), Fluor Corp. (NYSE:FLR-Free Report) and Andersons, Inc. (Nasdaq:ANDE-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Wednesday's Analyst Blog:

Can LinkedIn Deliver Upbeat Results This Quarter?

LinkedIn Corp. (NYSE:LNKD-Free Report) is scheduled to release second-quarter 2014 results on Jul 31, 2014, after the closing bell. Over the past three quarters, LinkedIn's earnings per share missed the Zacks Consensus Estimate while revenues came in ahead of the street.

LinkedIn currently has a Zacks Rank #2 (Buy). While LinkedIn's Zacks Consensus Estimate stands at a breakeven for the second quarter, the Most Accurate estimate is pegged at 2 cents which translates into an Earnings ESP of 0.00%.

Factors to Consider for the Quarter

LinkedIn has taken several initiatives to increase user engagement like the launch of a cheaper subscription service called Premium Spotlight. Apart from this, LinkedIn has redesigned its member profile pages with larger profile photos and header images.

Moreover, the professional networking company has launched a job search app for Apple's iPhone to cater to the growing number of its members who search for jobs via mobile devices. Additionally, LinkedIn resorted to strategic acquisitions, such as Newsle and Bizo, to not only enhance user experience but also garner additional dollars through targeted marketing strategies.

Another positive is LinkedIn's plan to expand in China which is the focal point of its international expansionary initiatives.

Nonetheless, continued investments to improve product and service offerings might affect LinkedIn's near-term profitability. Though impacting the company's operational performance in the short run, these investments drive member growth and user engagement over the long term. We remain encouraged by the impressive top-line growth recorded in the past few quarters.

Will GoPro Surprise This Earnings Season?

GoPro, Inc. (Nasdaq:GPRO-Free Report) is scheduled to release second-quarter 2014 results on Jul 31 after markets close. Let us see how things are shaping up for this announcement.

Factors to Impact Q2 Results

GoPro is a portable video camera maker offering cameras that can be attached to moving objects or even people. These cameras are specially used by sportsmen or sky divers to capture intricate details of a sporting episode.

GoPro has significant market potential in the portable camera industry. Furthermore, the company expects to generate strong revenues at its Media division. According to its latest filing, GoPro's videos have fetched 50 million hours of viewership in 2013. This can be further monetized to generate revenues to compensate for any deterioration in camera sales hurt by growing competition or other factors.

In addition, GoPro enjoys a first mover's advantage in the high definition portable camera market and its extensive portfolio of cameras is believed to help it counter intensifying competition from new entrants.

However, the company faces stiff competition in the wearable camera segment from large firms like Apple (APPL) and Google (GOOG). This apart, integration of portable cameras into smartphones is expected to pose another major headwind for the company going forward.

Earnings Whispers

Our proven model does not conclusively show that GoPro is likely to beat the Zacks Consensus Estimate in the second quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, #2 or #3 for this to happen. Unfortunately, this is not the case here as you can see below.

Zacks ESP: The Earnings ESP for GoPro is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at -12 cents.

Zacks Rank: GoPro carries a Zacks Rank #3 (Hold) which when combined with a 0.00% ESP makes surprise prediction difficult.

Also, we caution against stocks with Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.

Stocks That Warrant a Look

Here are a few stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter.

Silicon Motion Technology Corp (Nasdaq:SIMO-Free Report) with an Earnings ESP of +12.90% and a Zacks Rank #1 (Strong Buy).

Fluor Corp. (NYSE:FLR-Free Report), with an Earnings ESP of +3.06% and a Zacks Rank #2 (Buy).

The Andersons, Inc. (Nasdaq:ANDE-Free Report) with an Earnings ESP of +6.09% and Zacks Rank #2.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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