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ARRIS (ARRS) Beats Q2 Earnings Estimates, Revenues Lag

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ARRIS International plc’s (ARRS - Free Report) second-quarter 2017 earnings (excluding 39 cents from non-recurring items) of 55 cents per share topped the Zacks Consensus Estimate by 5 cents. However, the bottom line declined 32.1% from the year-ago quarter due to lower revenues.

Revenues of $1,664.2 million fell marginally short of the Zacks Consensus Estimate of $1,664.9 million. Moreover, the top line declined 3.81% on a year-over-year basis.

Performance Details

Quarterly gross margin (on an adjusted basis) of this Suwanee, GA-based company was 24.6% compared with 27.2% in the year-ago quarter. Total order backlog at the end of the quarter under review was $1.326 billion than $1.239 billion at the end of the year-ago quarter. Additionally, book-to-bill ratio was 1.01 compared with 0.94 in the prior-year quarter.

At the end of the second quarter, ARRIS generated cash from operating activities of $243.6 million compared with $260.8 million a year ago. In fact, the company exited the reported quarter with cash and cash equivalents of approximately $1.346 billion than $1.126 billion at the end of the previous quarter.

Long-term debt & financing lease obligations (net of current portion) was $2.134 billion, compared with approximately $2.18 billion at 2016-end. The company bought back 1.7 million shares for $44 million in the reported quarter.

Notably, ARRIS has bought back 4.9 million shares for $127 million so far this year.

ARRIS International PLC Price, Consensus and EPS Surprise

 

ARRIS International PLC Price, Consensus and EPS Surprise | ARRIS International PLC Quote

Guidance

ARRIS expects earnings (adjusted) in the band of 66–71 cents in  third-quarter 2017. Revenues are projected in the band of $1,740–$1,790 million. The Zacks Consensus Estimate for earnings is pegged at 50 cents on revenues of $1,660 million.

For full-year 2017, earnings (adjusted) are still anticipated in the band of $2.40–$2.60 and revenues in the range of $6,615–$6,830 million. The Zacks Consensus Estimate for the same is pegged at $2.19 on revenues of $6,710 million.

Zacks Rank & Stocks to Consider

ARRIS currently carries a Zacks Rank #3 (Hold). Investors interested in the broader Computer & Technology sector may consider BlackBerry Ltd. , Nokia Corporation (NOK - Free Report) and ADTRAN (ADTN - Free Report) carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Shares of BlackBerry, Nokia and ADTRAN have gained over 37%, 35 and 3%, respectively, so far this year.

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