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Maxim (MXIM) to Report Q2 Earnings: What's in the Offing?

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Maxim Integrated Products, Inc. (MXIM - Free Report) is set to report second-quarter fiscal 2021 results on Jan 26. The original equipment manufacturer of semiconductor analog and mixed signal integrated circuits has a wide range of products that allow it to serve a diverse clientele.

For the to-be-reported quarter, the Zacks Consensus Estimate for earnings has remained stable at 67 cents per share over the past 30 days. This indicates an increase of 19.6% from the year-ago reported figure.

The consensus mark for revenues is pegged at $605.8 million, implying an increase of 9.9% from the year-ago reported figure.

Performance in the Last Reported Quarter

In fiscal first-quarter 2021, earnings of 72 cents per share surpassed the Zacks Consensus Estimate of 58 cents. The figure increased 24.1% sequentially.

Net sales of $619.4 million also improved 16.2% from the year-ago period.

Let’s see how things have shaped up for this announcement.

In the fiscal first quarter, the Automotive end market generated 26% revenues, which increased 13% year over year. Also, the Industrial market generated approximately 31%, up 18% year over year.

The trend in automotive is expected to have continued in the to-be-reported quarter driven by increasing growth in infotainment content and factory automation products in areas of interface and power management.

The company has also been witnessing increasing customer wins in this segment, which is expected to have been a positive. Its expertise in Automotive Safety Integrity Levels is expected to have been a key catalyst in the quarter.

Also, revenues in the industrial segment are expected to have increased, primarily owing to an uptick in test equipment demand.

The Zacks Consensus Estimate for Automotive and industrial revenues is currently pegged at $165 million and 188 million, respectively. The consensus mark for revenues in the consumer segment is pegged at $119 million, while the same for the communications and data center segment is $131 million.

Moreover, Maxim’s exposure to consumer and communications markets increases risks. Also, macroeconomic concerns could impact the upcoming results.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Maxim in the to-be-reported 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: Maxim has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: It currently has a Zacks Rank #2.

Stocks to Consider

Here are a few companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat in the quarter to be reported.

TE Connectivity Ltd. (TEL - Free Report) has an Earnings ESP of +1.04% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Microchip Technology Incorporated (MCHP - Free Report) has an Earnings ESP of +1.48% and a Zacks Rank #2.

NXP Semiconductors N.V. (NXPI - Free Report) has an Earnings ESP of +1.30% and a Zacks Rank #2.

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