Credit: Shutterstock photoSemiconductor solutions provider QuickLogic CorporationQUIK is set to report third-quarter 2015 earnings results after the closing bell on Oct 28.
QuickLogic has a solid earnings track record over the past few quarters, with the company beating earnings estimates in three of the trailing four quarters. The average earnings surprise over the last four quarters is 14.9%.
Let's see how things are shaping up for this announcement.
Key Factors Influencing Q3 Results
QuickLogic recently expanded its extensive SenseMe portfolio of industry-leading sensor algorithms with the addition of new user contexts and gestures. The sensor processing solutions are compliant with Android CTS 5.1 - thus ensuring a consistent experience for device OEMs. They also facilitate the huge group of Android developers to create distinctive, product-differentiating applications.
During the quarter, the company's ArcticLink III BX display bridge solution platform was chosen by Lenovo to incorporate display bridging in its new C1 wearable. Also, Runtastic - a leading provider of apps, products and services that track and manage health and fitness data - selected QuickLogic 's ArcticLink 3 S2 Sensor Hub and SenseMe Algorithm Library for its new and innovative Runtastic Moment watch, which blends traditional timekeeping with modern activity tracking technology.
QuickLogic recently released preliminary third-quarter results, where it toned down its revenue expectations to incorporate an unforeseen and temporary decline of mature product revenue, which totaled about $1.3 million. The company now expects revenues of around $4.2 million for the quarter.
Earnings are expected to be weighed down by the decline in top line, and QuickLogic expects non-GAAP net loss to come in at about 8 cents for the third quarter. The current Zacks Consensus Estimate is pegged at a loss of 9 cents per share
Despite the temporary setback in mature product revenue, the company is executing its strategic initiatives as expected. Recent design wins, particularly with Runtastic, will boost its performance and expand its sphere of customers that have high brand recognition in the U.S., Europe and Asia.
Moreover, QuickLogic continues to expand its algorithm library, ensuring that its customers have access to a broad and growing set of sensor-based features and capabilities. These initiatives are expected to boost the company's operational performance in the near term.
Earnings Whispers
Our proven model does not conclusively show that QuickLogic will beat earnings estimate in this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. This is not the case here as you will see below.
Zacks ESP: Earnings ESP , which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is pegged at 0.00%.
Zacks Rank: QuickLogic's Zacks Rank #4 (Sell), when combined with a 0.00% ESP, makes surprise prediction difficult. We caution against stocks with Zacks Ranks #4 and #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Other Stocks That Warrant a Look
Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:
LinkedIn Corporation LNKD has an Earnings ESP of +15.63% and carries a Zacks Rank #2. It is scheduled to report results on Oct 29.
Suncor Energy Inc. SU has an Earnings ESP of +44.44% and holds a Zacks Rank #2. It is scheduled to report results on Oct 28.
Valero Energy Partners LP VLP has an Earnings ESP of +3.85% and holds a Zacks Rank #2. It is scheduled to report results on Oct 30.
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SUNCOR ENERGY (SU): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
