MEMC Electronic Materials Earnings: Investors Are Cheering These Numbers

S&P 500 (NYSE:SPY) component MEMC Electronic Materials Inc. (NYSE:WFR) climbed to a profit in the third quarter and beat Wall Street’s expectations in the process. Memc Electronic Material manufactures and sells silicon wafers that are used primarily in semiconductor and solar energy technologies.

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

MEMC Electronic Materials Inc. Earnings Cheat Sheet

Results: Reported a profit of $38.4 million (16 cents per diluted share) in the quarter. MEMC Electronic Materials Inc. had a net loss of $94.4 million or a loss 41 cents per share in the year-earlier quarter.

Revenue: Rose 16.5% to $601.6 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: MEMC Electronic Materials Inc. reported adjusted net income of 30 cents per share. By that measure, the company beat the mean analyst estimate of a loss of 12 cents per share. It beat the average revenue estimate of $496.4 million.

Quoting Management: “Our results were generally in line with expectations due to strong execution in both our solar and semiconductor businesses. The benefits of our strategy are becoming clear as we face difficult market conditions in both of the industries we serve. We are also beginning to see the benefits of a leaner organization which should better position us for increasingly challenging markets in the near-term,” said MEMC’s Chief Executive Officer Ahmad Chatila. “We will remain focused on delivering stronger returns for our stakeholders.”

Key Stats:

The company’s profit in the latest quarter follows losses in the three previous quarters. The company reported a net loss of $61.3 million in the second quarter, a loss of $92 million in the first quarter and a loss of $1.48 billion in the fourth of the last fiscal year.

The company has now beaten estimates the last two quarters. In the second quarter, it topped expectations with net income of 14 cents versus a mean estimate of 0 cents per share.

Last quarter, gross margins grew to 14.4%, a 3.1 percentage points difference from the year-earlier quarter. This breaks a streak of two consecutive quarters of shrinking margins.

The company’s revenue has now risen for two quarters in a row. In the second quarter, revenue increased 8.4% to $808.4 million from the year-earlier quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 9 cents a share to 7 cents over the last ninety days. Down from a loss of 14 cents per share ninety days ago, the average estimate for the fiscal year is now a loss of 16 cents.

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 provided by Xignite Financials. Earnings estimates provided by Zacks)

Don’t Miss These Additional Hot Stories:

Is AT&T’s Stock a Buy as iPhone Sales Soar?

Is the U.K. a Tech Company Tax Haven?

Should Apple’s CEO Be President of the United States?