Russian telecommunications company Vimpel Communications (NYSE:VIP) (VimpelCom) will be reporting first-quarter 2008 earnings on Wednesday. But first, let's run down what's expected from the company.

What analysts say:

  • Buy, sell, or waffle? Of the 20 analysts rating VimpelCom, a total of 11 have tagged the stock with a buy, while five say hold, and four have a sell rating. In our Motley Fool CAPS investor database, 1,169 of our 105,000 users have rated the stock, giving it a five-star rating overall.
  • Revenue. This quarter's average revenue estimate is $2.33 billion.
  • Earnings. Earnings, on average, are expected to come in around $0.44 per share.

What management says:
Coming off a fantastic quarter and full year 2007, VimpelCom remains upbeat about future growth. But it's going to be tough to match the 47% revenue growth and 80% net income growth the company saw in 2007, as the company is now facing the integration of the recent acquisition of Golden Telecom.

Snapping up Golden will broaden the company's service offerings to include fixed-line services, including a deal to operate wireless Wi-Fi networks in all of Russia's McDonald's (NYSE:MCD). But the company is also looking to expand geographically and into adjacent businesses, "where we believe would have a competitive edge or we have assets which could be leveraged effectively in that area," according to CEO Alexander Izosimov.

What management does:
While Vimpelcom's churn is well above what AT&T (NYSE:T) or Verizon (NYSE:VZ) -- and even a little higher than struggling Sprint Nextel (NYSE:S) -- typically reports in the U.S., it compares quite favorably to other carriers with heavy pre-paid subscriber bases in emerging markets. And all the major metrics continue to head in the right direction.








Registered mobile subscriber base (millions)







Churn (quarterly)*







Average revenue per user (ARPU)*







Source: Company filings.
*Churn and ARPU numbers calculated from registered subscriber base in Russian market only.

One Fool says
VimpelCom has been spending heavily lately to expand its networks, but with growth still going wild, it can certainly afford the increased expenses. I'm figuring expenses will be high in the first quarter as well, and some will likely be related to the acquisition of Golden.

But with Chinese mobile companies China Mobile (NYSE:CHL) and China Unicom (NYSE:CHU) now facing the uncertainty of a major reorganization, I think the strong and consistent growth at VimpelCom makes it one of the most attractive emerging market plays in telecommunications.

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