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What to Expect from NXP Semiconductors' (NXPI) Q1 Earnings?

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NXP Semiconductors N.V. (NXPI - Free Report) is slated to release first-quarter 2018 results on May 2. Notably, the company beat estimates in two of the trailing four quarters, delivering an average positive earnings surprise of 17.52%. In the last reported quarter, the company came up with a positive earnings surprise of 76.37%.

Let’s take a look at how things are shaping up prior to this announcement.

Factors to Consider

NXP Semiconductors is strengthening its position in the Internet of Things (IoT) market. Recently, the company collaborated with Alibaba (BABA - Free Report) Group’s operating system for IoT solutions called AliOS. The partnership is aimed at accelerating the development of smart cars in China.

In February, the company unveiled EdgeScale, “a management suite for secure edge computing”. NXP also collaborated with Kontron for the further development of edge computing, which will assist “Microsoft Azure IoT and Time Sensitive Networking (TSN) technologies” to meet the requirements of new age industrial IoT implementations.

The company also announced a partnership with LG Electronics and HELLA Aglaia for the development of automotive vision applications. Notably, the company also announced the availability of Automated Drive Kit for the development and testing of automated vehicle related applications.

Notably, Qualcomm’s (QCOM - Free Report) proposed acquisition of NXP Semiconductor is facing a headwind with the Chinese Ministry of Communications (MOFCOM) saying that Qualcomm must make more concessions for local players.

What the Zacks Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or #3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or #5) are best avoided.

NXP Semiconductors has a Zacks Rank #3 and an Earnings ESP of -2.37%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stock to Consider

Here is a company that you may want to consider as our model shows that it has the right combination of elements to post an earnings beat:

Seagate Technology PLC (STX - Free Report) has an Earnings ESP of +3.43% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

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