ARRIS International Plc (ARRS - Free Report) has an impressive earnings history having outperformed the Zacks Consensus Estimate in each of the preceding four quarters, with an average beat of 6.3%. Also, the company is expected to perform well on the bottom-line front in the third quarter of 2017 driven by a strong product portfolio. The company expects earnings (adjusted) between 66 cents and 71 cents in the same period.
Additionally, the Zacks Consensus Estimate for full-year 2017 has been revised upward approximately 2% in the last 60 days.
The company’s recent deals to broaden product portfolio are also impressive. Earlier in February, ARRIS had entered into a deal with Broadcom to purchase Brocade Communication’s Ruckus Wireless and ICX Switch units. The deal is expected to close by this year-end.
We are also encouraged by the company’s efforts to reward shareholders through buybacks. ARRIS has bought back 4.9 million shares for $127 million so far this year.
ARRIS’ trailing 12-month return on equity (ROE) supports growth potential. Not only has the company’s ROE of 14% remained roughly steady over the last year, it compares favorably with its industry’s ROE of 11%.
In view of the above positives, we believe investors should currently hold on to the ARRIS stock.
Zacks Rank & Key Picks
ARRIS carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the Computer and Technology sector are Arista Networks, Inc. (ANET - Free Report) , SeaChange International, Inc. (SEAC - Free Report) and Turtle Beach Corporation (HEAR - Free Report) . While Arista Networks sports a Zacks Rank #1 (Strong Buy), SeaChange International and Turtle Beach hold a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Arista Networks have soared more than 100% in a year. While SeaChange International shares have rallied 16.7% in the last six months, Turtle Beach shares have surged 25.9% over a period of three months.
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