Cypress Semiconductor Corporation
) is set to report fourth-quarter 2013 results today after
markets close. Last quarter, it posted a 100% positive surprise.
Let's see how things are shaping up for this announcement.
Growth Factors this Past Quarter
The company's third-quarter earnings were above the Zacks
Consensus Estimate by a couple of cents due to higher gross
margins and tight operating expense control. However, revenues
were down sequentially due to weakness in the mobile handset
Gross margins expanded 140 basis points sequentially due to
favorable customer mix and continued cost-reduction efforts.
For the fourth quarter, Cypress expects revenues in the range
of $163.0 million-$170.0 million, and gross margin to be
approximately 52.5%, which will vary with manufacturing product
mix. Non-GAAP earnings per share are likely to be in the range of
7 cents-9 cents (down 54.3% sequentially at the mid-point).
Our proven model does not conclusively show that Cypress is
likely to beat earnings this quarter. That is because a stock
needs to have both a positive
and a Zacks Rank #1, 2 or 3 for this to happen. That is not the
case here as you will see below.
The Earnings ESP for the stock is 0.00%.
Zacks Rank #3 (Hold):
Cypress' Zacks Rank #3 when combined with a 0.00% ESP makes
surprise prediction difficult.
We caution against stocks with Zacks Ranks #4 and 5
(Sell-rated stocks) going into the earnings announcement,
especially when the company is seeing negative estimate revisions
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post
an earnings beat this quarter:
Waddell & Reed Financial, Inc.
), with Earnings ESP of +2.44% and a Zacks Rank #1 (Strong
), with Earnings ESP of +66.67% and a Zacks Rank #1
Western Digital Corporation
), with Earnings ESP of +0.96% and a Zacks Rank #1
AFFYMETRIX INC (AFFX): Free Stock Analysis
CYPRESS SEMICON (CY): Free Stock Analysis
WESTERN DIGITAL (WDC): Free Stock Analysis
WADDELL&REED -A (WDR): Free Stock Analysis
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