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Earnings Scorecard: ANADIGICS

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Earnings estimates tumbled down for ANADIGICS, Inc. in the last seven days after the company reported results for the fourth quarter.

ANADIGICS reported in-line results for the fourth quarter but the outlook provided by the company was disappointing.

Consequently, all the analysts covering the stock decreased their estimates leading to a sharp fall in estimates for 2012.

The current Zacks Consensus Estimate for 2012 is a loss of $0.78, down by $0.10 in the last seven days and by $0.18 in the last thirty days.

ANADIGICS expects seasonality to impact results in the first quarter. Revenue is projected to decline as products sold to former top customers will reach end of life.  ANADIGICS continues to face challenges in an uncertain economic environment and there is no respite from weakening demand in the near-term.

ANADIGICS reported a loss of $0.23 in the fourth quarter compared to a net income of $0.05 per share in the year-ago quarter due to a decline in gross margin on the less favorable revenue mix.

Excluding one-time charges but including stock-based compensation expense, net loss came in at $0.16 per share, in line with the Zacks Consensus Estimate. Revenues of $36.5 million in the fourth quarter were down 2% sequentially.

On a positive note, ANADIGICS continues to see strong interest from OEMs, leveraging worldwide 3G and 4G deployments for applications beyond the traditional smartphone and tablet.

However, we do not expect the company to return to profitability in 2013 as well. Hence, we maintain a Neutral recommendation on the stock. In the short-run, we have a Zacks #4 Rank on the stock which translates into a Sell rating due to near-term pressure arising from the weak guidance provided by the management.

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