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iRobot (IRBT) Beats on Q1 Earnings, Raises 2018 EPS View

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iRobot Corporation (IRBT - Free Report) reported better-than-expected results for first-quarter 2018.

Earnings/Revenues

Quarterly adjusted earnings came in at 66 cents per share, outpacing the Zacks Consensus Estimate of 50 cents. Also, the bottom line came in higher than the year-ago tally of 52 cents per share.

Revenues in the quarter came in at $217.1 million, beating the Zacks Consensus Estimate of $216 million by a whisker. The top line also improved 28.8% year over year, on the back of stronger sales secured from all end-markets.

Costs/Margins

Cost of sales in the reported quarter was $101.3 million, up 24.8% year over year.  Gross margin was 53.3%, up 150 basis points (bps) year over year.

Total operating expenses in the reported quarter was $90.4 million, up 37.6% year over year. Operating margin was 11.7%, down 110 bps year over year.

Balance Sheet/Cash Flow

Exiting the first quarter, iRobot had cash and cash equivalents of $144.5 million, up from $128.6 million recorded as of Dec 30, 2017. Long-term liabilities came in at $13 million, down from $13.9 million reported at the end of 2017.

In the first three months of 2018, iRobot generated $29.8 million cash from operating activities, up from $26.8 million recorded in the year-ago period. Capital expenditure was $8.7 million compared to $3 million witnessed at the end of first-quarter 2017.

Outlook

iRobot believes higher sales of its state-of-the-art home-robotic products and ongoing marketing programs will aid in strengthening its competency in the near future. Based on the existing market conditions, this Zacks Rank #3 (Hold) company reiterated its revenue guidance for 2018 at $1.05-$1.08 billion, estimating year-over-year growth of 19-22%.

However, the company raised its earnings view for full-year 2018 to the $2.15-$2.40 per share range, from the prior outlook of $2.10-$2.35 per share.

Stocks to Consider

Some better-ranked stocks in the Zacks Industrial Products sector are listed below:

Axon Enterprise, Inc (AAXN - Free Report) sports a Zacks Rank of 1 (Strong Buy). The company pulled off an average positive earnings surprise of 12.17% over the last four quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.

Alamo Group, Inc. (ALG - Free Report) also flaunts a Zacks Rank #1. The company delivered an outstanding average positive earnings surprise of 188.33%, over the preceding four quarters.

Altra Industrial Motion Corp. (AIMC - Free Report) holds a Zacks Rank of 2 (Buy). The company came up with an average positive earnings surprise of 11.13% during the same time frame.

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