Communication network solution provider ADTRAN Inc. (ADTN Quick QuoteADTN - Free Report) reported second-quarter 2016 results wherein both the top and the bottom line surpassed the Zacks Consensus Estimate.

Operating Results

In the reported quarter, GAAP net income came in at $10.2 million or 21 cents a share compared with $2.5 million or 5 cents in the year-ago quarter. Meanwhile, quarterly adjusted earnings per share of 22 cents surpassed the Zacks Consensus Estimate of 19 cents. Total revenue of $162.7 million was up 1.6% year over year and above the consensus estimate of $162 million.

Quarterly gross margin came in at 48.5 % compared with 42.6% in the prior-year quarter. Meanwhile, operating income in the reported quarter totaled $14.8 million compared with $0.6 million in the last-year quarter. Quarterly operating margin was 9.1% compared with .4% in the prior-year quarter.

At the end of the first two quarters of 2016, ADTRAN generated $20.6 million of cash from operations compared with $21.2 million over the same period last year. The company used cash amounting to $13.87 million up till Jun 30, 2016, as compared to a cash flow of $15.6 million till Jun 30, 2015. After the first six months of 2016, ADTRAN had $70.9 million of cash and cash equivalents compared with $87.2 million in the same period of 2015.

Dividend Declared

Notably, the company has declared a cash dividend of 9 cents per share in the second quarter of 2016 which will be paid on Aug 11, 2016, to shareholders on record as of Jul 28, 2016.

Zacks Ranks & Other Key Picks

ADTRAN currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the sector include MiX Telematics Ltd. , ARI Network Services, Inc. (ARIS Quick QuoteARIS - Free Report) and Comtech Telecommunications Corp. (CMTL Quick QuoteCMTL - Free Report) . All the three companies sport a Zacks Rank #2 (Buy).

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