ADTRAN Fourth Quarter Earnings Sneak Peek

ADTRAN, Inc. (NASDAQ:ADTN) will unveil its latest earnings tomorrow, Wednesday, January 16, 2013. Adtran designs, manufactures, markets, and services network access solutions for communications networks.

ADTRAN, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 7 cents per share, a decline of 85.4% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from 6 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 7 cents during the last month. Analysts are projecting profit to rise by 65.6% versus last year to 73 cents.

Past Earnings Performance: The company topped forecasts last quarter after being in line with estimates the quarter prior. In the third quarter, it reported profit of 17 cents per share versus a mean estimate of 16 cents. Two quarters ago, it reported net income of 35 cents per share.

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A Look Back: In the third quarter, profit fell 74.4% to $9.3 million (15 cents a share) from $36.2 million (56 cents a share) the year earlier, but exceeded analyst expectations. Revenue fell 15.6% to $162.1 million from $192.2 million.

Here’s how ADTRAN traded following its last earnings report 3 months ago and leading up to its upcoming earnings report this week:

ADTRAN

Wall St. Revenue Expectations: On average, analysts predict $139.8 million in revenue this quarter, a decline of 20.3% from the year-ago quarter. Analysts are forecasting total revenue of $620.5 million for the year, a decline of 13.5% from last year’s revenue of $717.2 million.

Analyst Ratings: With five analysts rating the stock a sell, one rating it as a buy and six rating it as a hold, there are indications of a bearish outlook.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of three-straight quarters of revenue declines. Revenue fell 18.6% in the first quarter and 0.1% in second quarter before falling again in the third quarter.

Heading into this earnings announcement, net income has dropped 48.2% on average for the last four quarters.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 4.07 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company improved this liquidity measure from 4.01 in the second quarter to the last quarter driven in part by an increase in current assets. Current assets increased 3.3% to $469.1 million while liabilities rose by 1.9% to $115.3 million.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)