Back to top

What's in the Cards for Avid Technology (AVID) Q3 Earnings?

Read MoreHide Full Article

Avid Technology (AVID - Free Report) is set to report third-quarter 2018 results on Nov 7.

The company’s earnings lagged the Zack Consensus Estimate in three of the trailing four quarters, with the average negative surprise being 44.9%.

In the last reported quarter, Avid Technology reported loss of 12 cents that was slightly wider than the Zacks Consensus Estimate of a loss of 11 cents. However, revenues of $98.6 million beat the Zacks Consensus Estimate but fell 3.7% year over year.

The Zacks Consensus Estimate for third-quarter earnings has remained steady at 10 cents over the past seven days. The consensus mark for revenues currently stands at $104.9 million, reflecting slight decline on a year-over-year basis.

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

Key Factors to Watch Out

Avid Technology is expected to benefit from increasing recurring revenues, primarily driven by ongoing shift from licenses to subscriptions-based business model. Improving demand for the company’s high margin creative software and enterprise software suites along with maintenance is likely to drive top-line as well as profitability growth.

Notably, creative software and enterprise software suites along with maintenance currently represent more than half of Avid Technology's revenues. The company currently has more than 44 long-term agreements.


Moreover, the shipment of MediaCentral platform began in the end of July, which is likely to boost top-line growth.

However, headwinds in the professional services business are expected to keep gross margin under pressure.

What Our 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.

Avid Technology has a Zacks Rank #3 and Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With a Favorable Combination

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:

NetApp (NTAP - Free Report) has an Earnings ESP of +0.83% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Himax Technologies (HIMX - Free Report) has an Earnings ESP of +66.67% and a Zacks Rank #1.

The Trade Desk (TTD - Free Report) has an Earnings ESP of +0.29% and a Zacks Rank #2.


Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>

More from Zacks Analyst Blog

You May Like