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IPG Photonics (IPGP) to Post Q4 Earnings: What to Expect?

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IPG Photonics (IPGP - Free Report) is set to release fourth-quarter fiscal 2021 results on Feb 15.

For the quarter, the company expects revenues between $330 million and $360 million. Earnings are expected in the range of $1-$1.30 per share.

For the fourth quarter, the Zacks Consensus Estimate for earnings is pegged at $1.20 per share, unchanged over the past 30 days and indicating growth of 0.84% from the figure reported in the year-ago quarter.

The consensus mark for revenues is pegged at $347.95 million, which suggests an improvement of 3.36% from the year-ago quarter’s reported figure.

IPG Photonics’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed the same in one, delivering an earnings surprise of 8.61%, on average.
 

IPG Photonics Corporation Price and EPS Surprise

IPG Photonics Corporation Price and EPS Surprise

IPG Photonics Corporation price-eps-surprise | IPG Photonics Corporation Quote

 

Let’s see how things have shaped up for IPG Photonics prior to this announcement.

Factors to Consider

IPG Photonics’ fourth-quarter performance is likely to have benefited from an improving macroeconomic environment and the recovery in capital spending. Emerging trends like energy efficiency and sustainability, displacement of legacy lasers, and increases in the electric vehicle battery capacity are anticipated to have boosted demand for IPG’s laser solutions in the to-be-reported quarter.

Continued momentum in higher power products across the core materials processing domain and strength in new solutions are expected to have bolstered the top line. Strength in fiber & diode lasers, fiber amplifiers, and transceivers portfolios are expected to have aided revenues in the fourth quarter.

IPG’s top-line growth is expected to have benefited from strong sales of lightWELD.

IPG’s efforts to expand into new end markets like advanced applications (3D Printing and micro-materials processing), renewable energy, electric vehicle battery processing and systems, ultra-high-power cutting, and medical are likely to have contributed to the to-be-reported quarter’s performance.

The development of new medical applications utilizing fiber lasers for urological and dental procedures is anticipated to have aided the adoption of laser-based medical solutions. This, in turn, is likely to have driven the fourth-quarter performance.

Nonetheless, weakness in the China market due to soft demand in cutting applications, uncertainty due to supply chain issues and power outages are expected to have hurt top-line growth.

Stiff pricing competition is likely to have put pressure on IPG’s fourth-quarter bottom line. Moreover, increasing lead time for certain components and inflationary pressure on input costs are expected to have clipped its margins during the quarter under review.

What Our Model Says

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

IPG Photonics has an Earnings ESP of 0.00% and carries a Zacks Rank #3 currently. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:

Analog Devices (ADI - Free Report) has an Earnings ESP of +0.25% and is Zacks #2 Ranked. You can see the complete list of today’s Zacks #1 Rank stocks here.

ADI shares have underperformed the Zacks Computer & Technology sector in the past year. Analog Devices returned 1.8% compared with the sector’s rise of 3.6%. The company is set to report first-quarter 2022 on Feb 16, 2022.

Applied Materials (AMAT - Free Report) has an Earnings ESP of +0.93% and carries a Zacks Rank of 2 at present.

AMAT stock returned 23.7% in the past year. Applied Materials is set to report first-quarter 2022 results on Feb 16, 2022.

Fastly (FSLY - Free Report) has an Earnings ESP of +2.36% and a Zacks Rank #2.

Fastly shares are down 73.6% in the past year. Fastly is set to report fourth-quarter 2021 results on Feb 16, 2022.


Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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