Brocade Communications Systems Inc. First Quarter Earnings Sneak Peek

Brocade Communications Systems, Inc. (NASDAQ:BRCD) will unveil its latest earnings on Tuesday, February 21, 2012. Brocade Communications Systems is a supplier of networking equipment, including end-to-end Internet Protocol based Ethernet networking solutions and storage area networking solutions for service providers such as telecommunication firms and cable operators.

Brocade Communications Systems, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 10 cents per share, a decline of 16.7% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved up from 8 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 10 cents during the last month. For the year, analysts are projecting profit of 37 cents per share, a rise of 19.4% from last year.

Past Earnings Performance: The company fell short of estimates last quarter after being in line with forecasts the quarter prior. In the fourth quarter of the last fiscal year, it reported net income of 5 cents per share versus a mean estimate of 6 cents. Two quarters ago, it reported profit of 5 cents per share.

Investing Insights: Will the iPad 3 Be the Next Catalyst for Apple’s Stock?

Wall St. Revenue Expectations: On average, analysts predict $542.4 million in revenue this quarter, a decline of 0.7% from the year-ago quarter. Analysts are forecasting total revenue of $2.2 billion for the year, a rise of 2.3% from last year’s revenue of $2.15 billion.

Analyst Ratings: Analysts seem relatively indifferent about Brocade Communications Systems with 17 of 24 analysts surveyed maintaining a hold rating.

A Look Back: In the fourth quarter of the last fiscal year, the company swung to a loss of $4.3 million (one cent a share) from a profit of $23.4 million (5 cents) a year earlier, missing analyst expectations. Revenue remained stable at $550.5 million.

Key Stats:

Brocade Communications Systems reported a loss in the last quarter, which followed three quarters of profit. The company reported a profit of $1.9 million in the third quarter of the last fiscal year, a profit of $27.6 million in the second of the last fiscal year and a profit of $27.2 million in the first quarter of the last fiscal year.

Revenue rose in the fourth quarter of the last fiscal year after seeing a drop the quarter before. In the third quarter of the last fiscal year, revenue fell 0.1%.

The company’s gross margin shrank by 17.3 percentage points in the in the fourth quarter of the last fiscal year. Revenue rose 0% while cost of sales rose 74.5% to $223 million from a year earlier.

Stock Price Performance: Between November 17, 2011 and February 15, 2012, the stock price rose $1.09 (23.2%), from $4.70 to $5.79. The stock price saw one of its best stretches over the last year between June 24, 2011 and July 7, 2011, when shares rose for nine straight days, increasing 9.2% (+57 cents) over that span. It saw one of its worst periods between March 25, 2011 and April 5, 2011 when shares fell for eight straight days, dropping 7.5% (-47 cents) over that span.

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

Don’t Miss These Additional Hot Stories:

Why Are Gas Prices Climbing?

Organic Farming: The New Frontier

Will Gold Cleanse The World From Dirty Fiat Currencies?

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

More from The Cheat Sheet