Glu Mobile Inc. GLUU is slated to release second-quarter 2018 results on Jul 31.

In the last reported quarter, the company delivered a positive earnings surprise of 50%. However, the company delivered an average negative surprise of 136.67% over the last four quarters.

The mobile game maker posted revenues of $86 million in the last reported quarter, surpassing the Zacks Consensus Estimate of $73 million.

Let’s see how things are shaping up prior to this announcement.

Factors to Consider

Glu Mobile’s diverse gaming portfolio, which includes titles like Kim Kardashian: Hollywood, Design Home and Covet Fashion are driving top-line growth. Addition of new features and live operations are expected to boost user engagement.

The company’s launch of MLB Tap Sports Baseball 2018 on Apple’s AAPL App Store and Google Play store at March end is expected to be a top-line booster.

However, the company is facing increasing competition from established players like Electronic Arts EA and Activision Blizzard ATVI, which remains a major concern. Unfortunately, Glu’s other celebrity titles like Restaurant Dash: Gordon Ramsay are also losing popularity.

Furthermore, significant investment in sales and marketing are anticipated to be overhangs on margins.

Glu Mobile Inc. Price and EPS Surprise

Glu Mobile Inc. Price and EPS Surprise | Glu Mobile Inc. Quote

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates, if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or #5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Glu has a Zacks Rank #3 and its Earnings ESP is +5.77%, which increases the odds of an earnings beat.

You can see the complete list of today’s Zacks #1 Rank stocks here.

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