We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Qorvo (QRVO) to Report Q1 Earnings: What's in Store?
Read MoreHide Full Article
Qorvo Inc. (QRVO - Free Report) is set to release first-quarter fiscal 2018 earnings on Aug 2.
The company has a mixed record of earnings surprises. Despite missing two of the trailing four quarters, Qorvo has delivered an average positive surprise of 1.38%.
In the last quarter, the company’s earnings (including stock-based compensation) were 74 cents per share, which was in line with the Zacks Consensus Estimate. However, adjusted revenues of $643 million lagged the Zacks Consensus Estimate of $645 million.
Qorvo expects non-GAAP revenues in first-quarter fiscal 2018 to be approximately $610–$650 million. Earnings are expected to be in the range of 70–90 cents per share. The company also provided optimistic view for fiscal 2018.
Nevertheless, Qorvo underperformed the industry on a year-to-date basis. While the stock has returned 30.9%, the industry gained 33.6%.
The underperformance can be attributed to sluggish results that were negatively impacted by high inventory levels with handset manufacturers due to lower demand in China. Moreover, a reported delay in the launch of Apple’s (AAPL - Free Report) iPhone 8 also affected the stock price.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Notably, China accounts for almost 35% of Qorvo’s revenues. Per market research firm GFK, the overall growth of China’s smartphone will slow down in 2017, primarily due to depreciation of the yuan, rising cost of components and increasing competition.
According to its latest report, smartphone demand in China remained flat on a year-over-year basis at 110.1 million units in the second-quarter 2017. We believe that sluggish demand level in China will continue to impact Qorvo’s results in the going-to-be reported quarter.
However, improving market share at Samsung and Huawei – both accounting for more than 10% customers in the last quarter – is positive. Management expects opportunities at Samsung to grow sequentially in the second quarter. Moreover, strong adoption of the latest Bulk Acoustic Wave (BAW) 5 product is expected to drive growth in the quarter.
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 both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 61 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Qorvo has a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s 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.
Stocks to Consider
Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter.
Vishay Intertechnology (VSH - Free Report) with an Earnings ESP of +6.06% and sports a Zacks Rank #1.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Qorvo (QRVO) to Report Q1 Earnings: What's in Store?
Qorvo Inc. (QRVO - Free Report) is set to release first-quarter fiscal 2018 earnings on Aug 2.
The company has a mixed record of earnings surprises. Despite missing two of the trailing four quarters, Qorvo has delivered an average positive surprise of 1.38%.
In the last quarter, the company’s earnings (including stock-based compensation) were 74 cents per share, which was in line with the Zacks Consensus Estimate. However, adjusted revenues of $643 million lagged the Zacks Consensus Estimate of $645 million.
Qorvo expects non-GAAP revenues in first-quarter fiscal 2018 to be approximately $610–$650 million. Earnings are expected to be in the range of 70–90 cents per share. The company also provided optimistic view for fiscal 2018.
Qorvo, Inc. Price and EPS Surprise
Qorvo, Inc. Price and EPS Surprise | Qorvo, Inc. Quote
Nevertheless, Qorvo underperformed the industry on a year-to-date basis. While the stock has returned 30.9%, the industry gained 33.6%.
The underperformance can be attributed to sluggish results that were negatively impacted by high inventory levels with handset manufacturers due to lower demand in China. Moreover, a reported delay in the launch of Apple’s (AAPL - Free Report) iPhone 8 also affected the stock price.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Notably, China accounts for almost 35% of Qorvo’s revenues. Per market research firm GFK, the overall growth of China’s smartphone will slow down in 2017, primarily due to depreciation of the yuan, rising cost of components and increasing competition.
According to its latest report, smartphone demand in China remained flat on a year-over-year basis at 110.1 million units in the second-quarter 2017. We believe that sluggish demand level in China will continue to impact Qorvo’s results in the going-to-be reported quarter.
However, improving market share at Samsung and Huawei – both accounting for more than 10% customers in the last quarter – is positive. Management expects opportunities at Samsung to grow sequentially in the second quarter. Moreover, strong adoption of the latest Bulk Acoustic Wave (BAW) 5 product is expected to drive growth in the quarter.
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 both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 61 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Qorvo has a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s 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.
Stocks to Consider
Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter.
Kemet Corporation (KEM - Free Report) with an Earnings ESP of +11.11% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Vishay Intertechnology (VSH - Free Report) with an Earnings ESP of +6.06% and sports a Zacks Rank #1.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>