VimpelCom Earnings: An Early Look

Let's look forward to this company's next earnings report.

Dan Caplinger
Dan Caplinger
Mar 4, 2013 at 5:00PM
Technology and Telecom

Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and VimpelCom (NASDAQ:VEON) is one of them. 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. 

Russia may not be the first place you'd think of to look for telecom stocks, but as with many telecoms around the world, VimpelCom pays a solid dividend and offers the growth prospects of being one of the nation's largest providers of mobile service. Let's take an early look at what's been happening with VimpelCom over the past quarter and what we're likely to see in its quarterly report on Wednesday.

Stats on VimpelCom

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$5.84 billion

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

Will VimpelCom give investors a good connection this quarter?
Analysts have gotten a bit more optimistic about VimpelCom's prospects in recent months, keeping estimates for the just-ended quarter steady but boosting full-year 2013 projections by more than a nickel per share. The stock has followed suit, rising almost 25% since early December.

Russia is an extraordinary market for telecom, as Russians routinely have more than one SIM card, giving the industry revenue on more than 1.6 mobile lines per person. Although Mobile TeleSystems (NYSE:MBT) is the biggest player in the space, counting nearly half the country's population among its customer base, No. 2 player MegaFon and VimpelCom have entered into what amounts to a joint venture in a telecom retail business. Even though they aren't actively cooperating, the 5,500 stores that the business includes should help them both compete more effectively against Mobile TeleSystems.

But VimpelCom and its peers are looking closely at a case before a Russian appeals court that could take away some of the spectrum they use for 4G services. MegaFon would arguably be most directly affected if a reversal of a 2011 ruling that allowed the use of spectrum formerly used by TV companies holds up. It's unclear whether VimpelCom will benefit at MegaFon's expense or whether it also might be vulnerable to losing spectrum licenses granted by Russia's regulatory agency governing telecom companies.

In its quarterly report, watch for VimpelCom to expand on the three-year targets it announced in January. With its reach not only throughout the former Soviet Union but around the world, VimpelCom has high aspirations to go beyond Mother Russia to find growth.

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