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Diodes (DIOD) to Report Q3 Earnings: What's in the Cards?

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Diodes Incorporated (DIOD - Free Report) is scheduled to report third-quarter 2016 results on Nov 9, 2016. Last quarter, the company posted a negative earnings surprise of 4.76%. Notably, the stock has surpassed the Zacks Consensus Estimate twice while missing the same two times in the trailing four quarters with an average negative earnings surprise of 30.85%.

Let's see how things are shaping up for this announcement.

Factors to Consider

Diodes is a leading manufacturer and supplier of high-quality discrete and analog semiconductor products, primarily to the communications, computing, industrial, consumer electronics and automotive markets.

Last quarter, the company posted mixed results wherein the bottom line missed the Zacks Consensus Estimate but the top line surpassed the same. On a year-over-year basis, the company’s revenues registered solid growth but earnings witnessed sharp decline mainly due to increased operating expenses.

Diodes’ newly acquired businesses – BCD Semiconductor and Anachip Corporation – will further help it to expand its footprint in the broader analog market and extend its product offerings. We believe the company’s new product launches will boost overall results in the to-be-reported quarter.

However, competition from the likes of Fairchild Semiconductor International Inc. and Vishay Intertechnology Inc. (VSH - Free Report) remains a concern for the company.

Earnings Whispers?

Our proven model does not conclusively show that Diodes 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 30 cents per share. Hence, the difference is 0.00%.You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Diodes’ 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.

DIODES INC Price and EPS Surprise

DIODES INC Price and EPS Surprise | DIODES INC Quote

Stocks to Consider

Here are a couple of stocks, which you may consider as our model shows that they have the right combination of elements to post an earnings beat in their upcoming releases:

Asure Software Inc. (ASUR - Free Report) , with an Earnings ESP of +14.29% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

TubeMogul, Inc. , with an Earnings ESP of +8.00% and a Zacks Rank #3.

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