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What to Expect From Cypress Semiconductor's (CY) Q2 Earnings

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Cypress Semiconductor Corporation is slated to release second-quarter 2019 results on Jul 25.

Notably, the company surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with the average being 9.40%.

In the last reported quarter, its earnings and revenues surpassed the respective Zacks Consensus Estimate.

For the second quarter, Cypress Semiconductor anticipates revenues in the range of $515-$545 million. The Zacks Consensus Estimate for revenues is pegged at $531.9 million.

Non-GAAP earnings for the quarter are anticipated in the range of 22-26 cents. The Zacks Consensus Estimate for the same is pegged at 24 cents.

The company anticipates non-GAAP gross margin between 47% and 47.5%.

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

Cypress Semiconductor Corporation Price and EPS Surprise

 

Factors to Consider

Cypress Semiconductor’s strength in the industrial and automotive segment, as well as expanding presence in the IoT market — driven by acquisitions, product launches and consistent execution — are anticipated to boost the top line in the to-be-reported quarter.

Improving demand from industrial and Internet infrastructure, especially 4.5G and 5G customers, for the company’s flash memory products is likely to keep up the momentum in the Memory Products Division (MPD).

The Zacks Consensus Estimate for MPD revenues is pegged at $199 million.

Growth in the microcontroller business and strong demand for PSoC products are expected to be tailwinds for the Microcontroller and Connectivity Division (MCD) business in the quarter to be reported. However, slowdown across various MCD business units may impact this business unit.

The Zacks Consensus Estimate for MCD revenues is currently pegged at $334 million.

Softness in the consumer end market and sluggishness in the MCD business are concerns for its upcoming results. Further, the ongoing trade tension between the United States and China is an overhang.

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. Zacks Rank #4 or 5 (Sell rated) stocks are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Cypress has an Earnings ESP of 0.00% and carries a Zacks Rank #3, which makes surprise prediction difficult.

Stocks That Warrant a Look

You may consider the following stocks with a positive Earnings ESP and a favorable Zacks Rank.

Amazon.com, Inc. (AMZN - Free Report) has an Earnings ESP of +15.56% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Facebook, Inc. has an Earnings ESP of +0.61% and a Zacks Rank #2.

Thermo Fisher Scientific Inc. (TMO - Free Report) has an Earnings ESP of +0.54% and holds a Zacks Rank #3.

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