Gigamon Inc. is set to report second-quarter 2016 results on Jul 28. Last quarter, the company posted a positive earnings surprise of 100%. Let us see how things are shaping up for this announcement.
Factors at Play
The company reported better-than-expected first-quarter 2016 results. Both the top and bottom lines surpassed the Zacks Consensus Estimate.
Gigamon’s product launches are expected to drive growth. The GigaSMART and GigaVUE-HC2 platforms continue to witness increased adoption. Moreover, the company is adding clients, which should boost its financial results.
However, in addition to intensifying competition from Juniper Networks Inc. (JNPR - Free Report) and Cisco, the company faces pricing challenges. Gigamon may have to lower the price of its products and services to retain market share, which, in turn, will hurt its profitability.
Earnings Whispers?
Our proven model does not conclusively show that Gigamon will 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: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 9 cents. Hence, the difference is 0.00%.
Zacks Rank: Gigamon’s Zacks Rank #3 when combined with a 0.00% ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Stocks to Consider
Here are a couple of companies which, as per our model, have the right combination of elements to post an earnings beat this quarter:
Garmin Ltd. (GRMN - Free Report) with an Earnings ESP of +4.48% and a Zacks Rank #3
Amazon.com, Inc. (AMZN - Free Report) with Earnings ESP of +37.72% and a Zacks Rank #3
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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Gigamon Inc. is set to report second-quarter 2016 results on Jul 28. Last quarter, the company posted a positive earnings surprise of 100%. Let us see how things are shaping up for this announcement.
Factors at Play
The company reported better-than-expected first-quarter 2016 results. Both the top and bottom lines surpassed the Zacks Consensus Estimate.
Gigamon’s product launches are expected to drive growth. The GigaSMART and GigaVUE-HC2 platforms continue to witness increased adoption. Moreover, the company is adding clients, which should boost its financial results.
However, in addition to intensifying competition from Juniper Networks Inc. (JNPR - Free Report) and Cisco, the company faces pricing challenges. Gigamon may have to lower the price of its products and services to retain market share, which, in turn, will hurt its profitability.
Earnings Whispers?
Our proven model does not conclusively show that Gigamon will 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: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 9 cents. Hence, the difference is 0.00%.
Zacks Rank: Gigamon’s Zacks Rank #3 when combined with a 0.00% ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Stocks to Consider
Here are a couple of companies which, as per our model, have the right combination of elements to post an earnings beat this quarter:
Garmin Ltd. (GRMN - Free Report) with an Earnings ESP of +4.48% and a Zacks Rank #3
Amazon.com, Inc. (AMZN - Free Report) with Earnings ESP of +37.72% and a Zacks Rank #3
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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