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Qorvo (QRVO) Q2 Earnings: What's in the Cards this Time?

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Qorvo, Inc. (QRVO - Free Report) is set to release second-quarter fiscal 2017 earnings on Nov 3. In the last quarter, the company reported a negative earnings surprise of 1.16%. However, we note that the company delivered positive earnings surprises in three out of the last four quarters, with an average positive earnings surprise of 12.03%.

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

Factors to Consider                                              

Qorvo delivered mixed results in the first-quarter of fiscal 2017. While earnings missed the Zacks Consensus Estimate, revenues beat the same. On a year-over-year basis, both the top line and the bottom line registered decent growth.

For the second-quarter of fiscal 2017, Qorvo expects non-GAAP revenues to be approximately $820 million–$850 million, given a healthy demand schedule. The company expects gross margin of approximately 47% and earnings within $1.35 and $1.45 per share. Qorvo offers a complete product portfolio, targeting the highest growth segments of its market including filters, switches and tuners. The company is well-positioned for the highest growth opportunities by leveraging its diversified product portfolio, systems-level expertise, R&D and manufacturing scale and internal assembly and test capabilities.

Qorvo’s ability to meet the growing requirements of its customers through the introduction of innovative products is likely to augur well for the company’s results in the to-be reported quarter.

On Sep 26, 2016, Qorvo announced the introduction of two new control products into its CATV product portfolio that are designed to facilitate cable networking based on the DOCSIS 3.1 model. The new products provide greater flexibility to cable operators in terms of network design and facilitate improved upstream and downstream bandwidth while cutting down power consumption.

Earnings Whispers?

Our proven model does not conclusively show that Qorvo is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.

Zacks ESP: Qorvo’s Earnings ESP is 0.00%. This is because the Most Accurate estimate stands and the Zacks Consensus Estimate are pegged at $1.19 per share. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.

Zacks Rank: Qorvo carries a Zacks Rank #3, which when combined with a 0.00% ESP makes surprise prediction difficult.

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

QORVO INC Price and EPS Surprise

QORVO INC Price and EPS Surprise | QORVO INC Quote

Stock to Consider

Here are some companies that, as per our model, have the right combination of elements to post an earnings beat this quarter:

Stratasys Ltd. (SSYS - Free Report) with an Earnings ESP of +41.67% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

SITO Mobile, Ltd. with an Earnings ESP of +100.00% and a Zacks Rank #1.

Asure Software, Inc. (ASUR - Free Report) with an Earnings ESP of +14.29% and a Zacks Rank #2.

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