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ADTRAN (ADTN) Q1 Loss Wider Than Expected on Revenue Decline
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ADTRAN Inc. (ADTN - Free Report) reported lackluster first-quarter 2018 results with both the top line and bottom line missing the respective Zacks Consensus Estimate.
GAAP loss for the quarter was $9.1 million or loss of 19 cents per share against earnings of $6.7 million or 14 cents per share in the year-ago quarter. Excluding non-recurring items, non-GAAP loss for the reported quarter was 29 cents per share against earnings of 18 cents in the year-earlier quarter and was wider than the Zacks Consensus Estimate of a loss of 15 cents. The significant decline was primarily attributable to slowdown in the spending at a domestic Tier 1 customer (resulting in lower product volumes), high restructuring expenses and a merger-related review.
Total revenues for the first quarter were $120.8 million compared with $170.3 million in the prior-year quarter. Also, the top line missed the Zacks Consensus Estimate of $126 million. Sales at both the segments, namely Product and Service, decreased 26.7% and 41.6%, respectively, on a year-over-year basis to $105.3 million and $15.6 million.
Quarterly gross margin came in at 32.9% compared with 43.3% in the prior-year period. Operating loss in the reported quarter totaled $26.6 million against operating income of $6.9 million in the year-ago quarter.
Cash flow from operating activities totaled $46.2 million compared with $9 million in the year-ago period. ADTRAN exited the quarter with cash and cash equivalents of $82.6 million. The company maintained its dividend of 9 cents per share for the quarter.
Moving forward, ADTRAN expects improved performance in the coming quarters with continued strength in the European business and a rebound in its North American business in the second half. The company also expects to benefit from the acquisition of the EPON business from Sumitomo Electric Industries Ltd, a leading global provider of next-generation optical broadband access network solutions in Asia and North America.
ADTRAN carries a Zacks Rank #3 (Hold). Better-ranked stocks in the broader industry include Comtech Telecommunications Corp. (CMTL - Free Report) , sporting Zacks Rank #1 (Strong Buy), and Clearfield, Inc. (CLFD - Free Report) and PCTEL, Inc. , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Comtech Telecommunications has a long-term earnings growth expectation of 5%. It delivered an average positive earnings surprise of 111.4% in the trailing four quarters, beating estimates in each.
Clearfield is currently trading at a forward P/E of 31.1x.
PCTEL delivered an average positive earnings surprise of 17.9% in the trailing four quarters, beating estimates twice.
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ADTRAN (ADTN) Q1 Loss Wider Than Expected on Revenue Decline
ADTRAN Inc. (ADTN - Free Report) reported lackluster first-quarter 2018 results with both the top line and bottom line missing the respective Zacks Consensus Estimate.
GAAP loss for the quarter was $9.1 million or loss of 19 cents per share against earnings of $6.7 million or 14 cents per share in the year-ago quarter. Excluding non-recurring items, non-GAAP loss for the reported quarter was 29 cents per share against earnings of 18 cents in the year-earlier quarter and was wider than the Zacks Consensus Estimate of a loss of 15 cents. The significant decline was primarily attributable to slowdown in the spending at a domestic Tier 1 customer (resulting in lower product volumes), high restructuring expenses and a merger-related review.
Total revenues for the first quarter were $120.8 million compared with $170.3 million in the prior-year quarter. Also, the top line missed the Zacks Consensus Estimate of $126 million. Sales at both the segments, namely Product and Service, decreased 26.7% and 41.6%, respectively, on a year-over-year basis to $105.3 million and $15.6 million.
ADTRAN, Inc. Price, Consensus and EPS Surprise
ADTRAN, Inc. Price, Consensus and EPS Surprise | ADTRAN, Inc. Quote
Quarterly gross margin came in at 32.9% compared with 43.3% in the prior-year period. Operating loss in the reported quarter totaled $26.6 million against operating income of $6.9 million in the year-ago quarter.
Cash flow from operating activities totaled $46.2 million compared with $9 million in the year-ago period. ADTRAN exited the quarter with cash and cash equivalents of $82.6 million. The company maintained its dividend of 9 cents per share for the quarter.
Moving forward, ADTRAN expects improved performance in the coming quarters with continued strength in the European business and a rebound in its North American business in the second half. The company also expects to benefit from the acquisition of the EPON business from Sumitomo Electric Industries Ltd, a leading global provider of next-generation optical broadband access network solutions in Asia and North America.
ADTRAN carries a Zacks Rank #3 (Hold). Better-ranked stocks in the broader industry include Comtech Telecommunications Corp. (CMTL - Free Report) , sporting Zacks Rank #1 (Strong Buy), and Clearfield, Inc. (CLFD - Free Report) and PCTEL, Inc. , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Comtech Telecommunications has a long-term earnings growth expectation of 5%. It delivered an average positive earnings surprise of 111.4% in the trailing four quarters, beating estimates in each.
Clearfield is currently trading at a forward P/E of 31.1x.
PCTEL delivered an average positive earnings surprise of 17.9% in the trailing four quarters, beating estimates twice.
Can Hackers Put Money INTO Your Portfolio?
Earlier this year, credit bureau Equifax announced a massive data breach affecting 2 out of every 3 Americans. The cybersecurity industry is expanding quickly in response to this and similar events. But some stocks are better investments than others.
Zacks has just released Cybersecurity! An Investor’s Guide to help Zacks.com readers make the most of the $170 billion per year investment opportunity created by hackers and other threats. It reveals 4 stocks worth looking into right away.
Download the new report now>>