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Factors Setting the Tone for Akoustis' (AKTS) Q1 Earnings

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Akoustis Technologies, Inc. (AKTS - Free Report) first-quarter fiscal 2020 results are expected to have benefited from continued momentum in its bulk acoustic wave (BAW) technology-based RF filter solutions.

The Zacks Consensus Estimate for first-quarter bottom line has remained steady at a loss of 23 cents in the past 30 days, narrower than year-ago reported loss of 33 cents.

The consensus mark for revenues is currently pegged at $0.59 million, indicating growth of 88.7% on a year-over-year basis.

Notably, shares of Akoustis have returned 66.2% year to date, significantly outperforming industry’s rise of 34.1%.

Factors to Consider

Akoustis’ proprietary XBAW technology offers high bandwidth RF filter performance. Growing clout of the company’s XBAW technology-based filters are likely to get reflected in first-quarter revenues.

Management anticipates revenues to remain flat sequentially. Meanwhile, the company anticipates revenues from non-core legacy MEMS (or microelectromechanical systems) foundry to decline in the first-quarter as it focuses on enhancing XBAW filter business.

Further, the company anticipates revenues from BAW filters to improve more than 50% on a quarter-over-quarter basis.

Moreover, innovation in WiFi and LTE infrastructure market is driving demand for company’s latest WiFi and LTE filters. Specifically, new deal wins for the company’s 5.6 GHz and 5.2 GHz WiFi filters are likely to have driven the first-quarter top line.

Furthermore, accelerated deployment of 5G is bolstering the demand for company’s 5G filters, primarily in the ultra-high frequency band spectrum. This is anticipated to get reflected in first-quarter revenues.

Additionally, the company’s first-quarter results is likely to reflect diversification of its filter products beyond mobile infrastructure to defense and military communication applications

Nonetheless, higher investments in R&D and product enhancements amid stiff competition from major players in the RF semiconductor vertical, including Broadcom, Qorvo (QRVO - Free Report) and Skyworks (SWKS - Free Report) , is likely to have impacted profitability in the first quarter.

What Our Model Says

According to the Zacks model, a combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Although Akoustis has a Zacks Rank #2, an Earnings ESP of 0.00% makes surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here is a stock that you may consider, as our proven model shows that it has the right combination of elements to post an earnings beat this quarter.

Advanced Energy Industries, Inc. (AEIS - Free Report) has an Earnings ESP of +4.17% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here. The company is set to report third-quarter 2019 earnings on Nov 12.

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