Ribbon Communications (RBBN) came out with quarterly earnings of $0.04 per share, in line with the Zacks Consensus Estimate. This compares to earnings of $0.06 per share a year ago. These figures are adjusted for non-recurring items.
A quarter ago, it was expected that this maker of technology for telephone services over internet networks would post a loss of $0.05 per share when it actually produced a loss of $0.02, delivering a surprise of 60%.
Over the last four quarters, the company has surpassed consensus EPS estimates two times.
Ribbon Communications
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
Ribbon Communications shares have added about 23.7% since the beginning of the year versus the S&P 500's gain of 19%.
What's Next for Ribbon Communications?
While Ribbon Communications has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Ribbon Communications: favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $0.10 on $222.69 million in revenues for the coming quarter and $0.27 on $859.16 million in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Communication - Network Software is currently in the top 37% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
Another stock from the same industry, Airspan Networks Holdings Inc. (MIMO), has yet to report results for the quarter ended June 2023.
This company is expected to post quarterly loss of $0.27 per share in its upcoming report, which represents a year-over-year change of -8%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.
Airspan Networks Holdings Inc.'s revenues are expected to be $25.4 million, down 45.9% from the year-ago quarter.
Top 5 ChatGPT Stocks Revealed
Zacks Senior Stock Strategist, Kevin Cook names 5 hand-picked stocks with sky-high growth potential in a brilliant sector of Artificial Intelligence. By 2030, the AI industry is predicted to have an internet and iPhone-scale economic impact of $15.7 Trillion.
Today you can invest in the wave of the future, an automation that answers follow-up questions … admits mistakes … challenges incorrect premises … rejects inappropriate requests. As one of the selected companies puts it, “Automation frees people from the mundane so they can accomplish the miraculous.”
Ribbon Communications Inc. (RBBN) : Free Stock Analysis Report
Airspan Networks Holdings Inc. (MIMO) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
