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RadioShack Earnings: An Early Look

http://www.fool.com/investing/general/2013/02/23/radioshack-earnings-an-early-look.aspx

Dan Caplinger
February 23, 2013

Earnings season is now starting to wind down, with most companies already having reported their quarterly results. But there are still some companies left to report, and RadioShack (NYSE: RSH) is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

The woes of big-box electronics stores over the past several years has gotten a lot of attention, but even small-store format retailer RadioShack has gone through difficulties as it tries to find a viable niche for itself in a changing retail environment. Let's take an early look at what's been happening with RadioShack over the past quarter and what we're likely to see in its quarterly report on Tuesday.

Stats on RadioShack

Analyst EPS Estimate

($0.05)

Year-Ago EPS

$0.12

Revenue Estimate

$1.36 billion

Change From Year-Ago Revenue

(1.6%)

Earnings Beats in Past 4 Quarters

0

Source: Yahoo! Finance.

Will RadioShack pick up a signal this quarter?
Analysts have improved their view on RadioShack over the past few months, raising their consensus earnings call for the just-finished quarter by a penny per share and boosting EPS for full-year 2013 by $0.04. Yet what's really shocking is just how strong the stock has been lately, with shares up more than 60% since mid-November.

RadioShack has had difficulty coming up with a viable identity as a business. On one hand, its small stores have no hope of competing against Best Buy (NYSE: BBY) in stocking the high-end products that the big-box retailer relies on for its sales. On the other hand, Internet-based sales of electronics has given Amazon.com (NASDAQ: AMZN) a huge edge over both RadioShack and Best Buy, leaving customers with far fewer reasons to venture into