), or "TI," is set to report fourth-quarter 2013 results on Jan
21. Last quarter, it posted a 1.75% negative surprise. Let us see
how things are shaping up for this announcement.
Growth Factors this Past Quarter
TI's third-quarter earnings missed the Zacks Consensus
Estimate by a penny. However, revenues were up 6.5% sequentially
but down 4.3% year over year. The sequential increase was driven
by stronger demand in the computing, game console and handset
markets that had been very weak in the last quarter.
TI's gross margin of 54.8% was up 331 basis points (bps)
sequentially and 528 bps from the year-ago quarter. The improving
product mix led to higher gross margins in the third quarter.
Last month, TI narrowed its revenue and earnings expectations
for the fourth quarter of 2013. TI now expects revenues around
$2.92 billion-$3.04 billion, the mid-point being above the Zacks
Consensus Estimate of $2.99 billion. The earnings per share
guidance is expected in the range of 44 cents-48 cents.
Our proven model does not conclusively show that Texas
Instruments will 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.
Both the Most Accurate estimate and the Zacks Consensus Estimate
stand at 47 cents. Hence, the difference is 0.00%.
Zacks Rank #3 (Hold):
TI's Zacks Rank when combined with a 0.00% ESP makes surprise
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
You could consider other stocks with a positive earnings ESP
and Zacks Rank #1, 2 or 3 such as:
Bally Technologies, Inc.
) with Earnings ESP of +3.13% and a Zacks Rank #1 (Strong
Western Digital Corporation
) with Earnings ESP of +0.48% and a Zacks Rank #1
Cirrus Logic Inc.
) with Earnings ESP of +4.41% and a Zacks Rank #1
BALLY TECH INC (BYI): Free Stock Analysis
CIRRUS LOGIC (CRUS): Free Stock Analysis
TEXAS INSTRS (TXN): Free Stock Analysis
WESTERN DIGITAL (WDC): Free Stock Analysis
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