KEMET Earnings: Here’s Why Investors are Ambivalent Now

KEMET Corp. (NYSE:KEM) had a loss and missed Wall Street’s expectations, BUT beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company.

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KEMET Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $-0.22 in the quarter versus EPS of $-0.16 in the year-earlier quarter.

Revenue: Decreased 3.4% to $203.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: KEMET Corp. reported adjusted EPS loss of $0.22 per share. By that measure, the company missed the mean analyst estimate of $-0.08. It beat the average revenue estimate of $201.57 million.

Quoting Management: Per Loof, KEMET’s Chief Executive Officer, stated, “Revenue remained more or less flat to our prior quarter as forecasted and seems to have leveled off at this level for at least one more quarter. The team remains focused on delivering improved financial results even as the industry remains trapped by an economy that is moving sideways. We expect to see benefits during our next fiscal year from our relationship with NEC TOKIN primarily related to our recently signed PLP and cross-licensing agreements. We are optimistic that we can build significant shareholder value from our recent equity investment.”

Key Stats (on next page)…

Revenue increased 1.6% from $200.3 million in the previous quarter. EPS increased to $-0.22 in the quarter versus EPS of $-0.05 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.07 to a profit $0.04. For the current year, the average estimate has moved up from a loss of $0.48 to a loss of $0.46 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)