Magma Design Automation, Inc. First Quarter Earnings Sneak Peek

Magma Design Automation, Inc. (NASDAQ:LAVA) will unveil its latest earnings on Thursday, August 25, 2011. The Company provides design and implementation, analysis and verification software that enables chip designers to reduce the time it takes to design and produce complex integrated circuits.

Magma Design Automation, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 7 cents per share after the company broke even in the year earlier quarter. During the past three months, the average estimate has moved down from 8 cents. Between one and three months ago, the average estimate moved down, but it has been unchanged at 7 cents during the last month. For the year, analysts are projecting profit of 39 cents per share, a rise of more than fourfold from last year.

Past Earnings Performance: The company has missed estimates in the last two quarters. In the fourth quarter of the last fiscal year, it missed the mark by 4 cents as a result of reporting net income of 4 cents against an estimate of profit of 8 cents per share. In the third quarter of the last fiscal year, the company fell short of forecasts by 4 cents.

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Wall St. Revenue Expectations: On average, analysts predict $36.4 million in revenue this quarter, a rise of 11.9% from the year ago quarter. Analysts are forecasting total revenue of $159 million for the year, a rise of 14.1% from last year’s revenue of $139.3 million.

Analyst Ratings: The limited number of analysts covering the stock seem bullish with three analysts rating it as a buy, none rating it as a sell and none rating it as a hold.

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past four quarters. Over that span, the company has averaged growth of 13.2%, with the biggest boost coming in the second quarter of the last fiscal year when revenue rose 14.4% from the year earlier quarter.

Competitors to Watch: Synopsys, Inc. (NASDAQ:SNPS), Mentor Graphics Corp. (NASDAQ:MENT), Cadence Design Systems, Inc. (NASDAQ:CDNS), PDF Solutions, Inc. (NASDAQ:PDFS), ANSYS, Inc. (NASDAQ:ANSS), Tessera Technologies, Inc. (NASDAQ:TSRA), Parametric Technology (NASDAQ:PMTC), Autodesk, Inc. (NASDAQ:ADSK), Cimatron Ltd. (NASDAQ:CIMT), and National Instruments Corp (NASDAQ:NATI).

Stock Price Performance: During July 22, 2011 to August 19, 2011, the stock price had dropped $2.88 (-36%) from $8 to $5.12. The stock price saw one of its best stretches over the last year between January 28, 2011 and February 8, 2011 when shares rose for eight-straight days, rising 15.2% (+82 cents) over that span. It saw one of its worst periods between April 4, 2011 and April 13, 2011 when shares fell for eight-straight days, falling 7.4% (-52 cents) over that span. Shares are up 11 cents (+2.2%) year to date.

(Source: Xignite Financials)

Investing Insights: Steve Jobs Prepares to Deliver a New Catalyst for Apple’s Stock.