Emulex Corp First Quarter Earnings Sneak Peek

Emulex Corporation (NYSE:ELX) will unveil its latest earnings on Thursday, October 25, 2012. Emulex is the provider of a broad range of network convergence solutions that intelligently connect servers, storage, and networks within the data center.

Emulex Corporation Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 10 cents per share, a rise of 66.7% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 14 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at 10 cents during the last month. For the year, analysts are projecting profit of 50 cents per share, a decline of 21.9% from last year.

Past Earnings Performance: Last quarter, the company beat estimates by 8 cents, coming in at net income of 22 cents a share versus the estimate of profit of 14 cents a share. It marked the fourth straight quarter of beating estimates.

Earnings season is back and more important than ever. Get our newest CHEAT SHEET stock picks now

A Look Back: In the fourth quarter of the last fiscal year, the company’s loss widened to a loss of a $27.6 million (32 cents a share) from a loss of $16 million (18 cents) a year earlier, but beat analyst expectations. Revenue rose 4.5% to $129 million from $123.4 million.

Stock Price Performance: Between September 21, 2012 and October 19, 2012, the stock price dropped 96 cents (-13%), from $7.40 to $6.44. The stock price saw one of its best stretches over the last year between January 4, 2012 and January 12, 2012, when shares rose for seven straight days, increasing 25.3% (+$1.78) over that span. It saw one of its worst periods between May 2, 2012 and May 18, 2012 when shares fell for 13 straight days, dropping 18.7% (-$1.61) over that span.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.54 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 regressed in this liquidity measure from 4.99 in the third quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 50.8% to $102.6 million while assets rose 7% to $363.2 million.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 14.8% in the first quarter of the last fiscal year, 12.9% in the second quarter of the last fiscal year and 12.2% in the third quarter of the last fiscal year before increasing again in the fourth quarter of the last fiscal year of the last fiscal year.

Analyst Ratings: With four analysts rating the stock as a buy, two rating it as a sell and six rating it as a hold, there are indications of a bullish outlook.

Wall St. Revenue Expectations: Analysts predict a rise of 1.4% in revenue from the year-earlier quarter to $120.1 million.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

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

Don’t Miss These Additional Hot Stories:

Time to Buy This Dow Darling Now?

Are Google Shares a Buy Post-Earnings?

Should This Stock be in Your Portfolio After Its Latest Report?