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iRobot (IRBT) Q4 Earnings & Revenues Beat Estimates, Up Y/Y

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

Earnings/Revenues

Quarterly adjusted earnings came in at 84 cents per share, comfortably outpacing the Zacks Consensus Estimate of 51 cents. Also, the bottom line came in higher than the year-ago figure of 54 cents.

Notably, the company reported adjusted earnings of $2.84 for 2018, an increase of 60.5% from the prior year.

iRobot Corporation Price, Consensus and EPS Surprise

iRobot Corporation Price, Consensus and EPS Surprise | iRobot Corporation Quote

Revenues for the quarter came in at $384.7 million, surpassing the consensus estimate of $379 million. The top line also improved 17.7% year over year. The upside stemmed from robust sales secured from Japan.

The company generated revenues of $1,092.6 million in 2018, higher than $883.9 million recorded a year ago.

Costs/Margins

Cost of sales in the reported quarter was $198.2 million, up 14.3% year over year.  Gross margin was 48.5%, up 150 basis points (bps).

Total operating expenses in the reported quarter was $156.7 million, up 20.1% year over year. Operating margin was 7.7%, up 70 bps.

Balance Sheet/Cash Flow

Exiting the fourth quarter, iRobot had cash and cash equivalents of $130.4 million, up from $128.6 million recorded as of Dec 30, 2017. Long-term liabilities came in at $17.9 million, down from $23.5 million reported at the end of 2017.

At the end of 2018, iRobot generated $71.7 million cash from operating activities, down from $76.3 million recorded a year ago. Capital expenditure was $32.4 million on Dec 29, 2018, compared with $23.4 million witnessed at the end of 2017.

Outlook

iRobot believes stronger demand for innovative home-robotic products and strategic marketing programs will continue to drive its revenues in the upcoming quarters. Based on the existing market conditions, the company anticipates generating revenues in the range of $1.28-$1.31 billion and earnings in the band of $3.00-$3.25 per share in 2019.

By 2020, iRobot intends to secure revenue growth of roughly 19%, gross margin rise of about 48% and operating margin growth of 10%.

Zacks Rank & Other Stocks to Consider

iRobot currently sports a Zacks Rank #1 (Strong Buy).

Other top-ranked stocks in the same space include Alarm.com Holdings, Inc. (ALRM - Free Report) , Cintas Corporation (CTAS - Free Report) and DXP Enterprises, Inc. (DXPE - Free Report) . While Alarm.com Holdings sports a Zacks Rank #1, Cintas and DXP Enterprises carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Alarm.com Holdings exceeded estimates in each of the trailing four quarters, the average positive earnings surprise being 27.26%.

Cintas outpaced estimates in each of the trailing four quarters, the average positive earnings surprise being 6.81%.

DXP Enterprises exceeded estimates thrice in the trailing four quarters, the average positive earnings surprise being 112.62%.

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