SanDisk Earnings Nearing

S&P 500 (NYSE:SPY) component SanDisk (NASDAQ:SNDK) will unveil its latest earnings on Thursday, October 18, 2012. SanDisk is a multinational corporation whose main focus is the design, development, manufacturing and marketing of flash memory card products. Its data-storage solutions include removable cards and universal serial bus drives, which can be used in a wide gamut of consumer electronics products, such as digital cameras and mobile phones.

SanDisk Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 30 cents per share, a decline of 73.7% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 37 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at 30 cents during the last month. Analysts are projecting profit to rise by 63.3% versus last year to $1.60.

Past Earnings Performance: The company is looking to break the streak of missing estimates in the past two quarters. Last quarter, it fell short of analyst expectations by reporting profit of 15 cents per share against an estimate of net income of 17 cents per share. The quarter before that, it missed forecasts by 5 cents.

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A Look Back: In the second quarter, profit fell 94.8% to $13 million (5 cents a share) from $248.4 million ($1.02 a share) the year earlier, missing analyst expectations. Revenue fell 24.9% to $1.03 billion from $1.37 billion.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.27 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 4.52 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased more than twofold to $1.82 billion while assets rose 1.3% to $4.14 billion.

Stock Price Performance: Between July 19, 2012 and October 12, 2012, the stock price rose $7.20 (20.5%), from $35.08 to $42.28. The stock price saw one of its best stretches over the last year between September 10, 2012 and September 17, 2012, when shares rose for six straight days, increasing 4% (+$1.76) over that span. It saw one of its worst periods between December 9, 2011 and December 19, 2011 when shares fell for seven straight days, dropping 6.9% (-$3.49) over that span.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of two-straight quarters of revenue declines. Revenue fell 6.8% in the first quarter and dropped again in the second quarter.

Heading into this earnings announcement, net income has dropped 53.3% on average for the last four quarters.

Wall St. Revenue Expectations: On average, analysts predict $1.22 billion in revenue this quarter, a decline of 14.1% from the year-ago quarter. Analysts are forecasting total revenue of $4.95 billion for the year, a decline of 12.5% from last year’s revenue of $5.66 billion.

Analyst Ratings: There are 14 out of 24 analysts surveyed (58.3%) rating SanDisk a buy.

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

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