Citrix Systems Inc.
(
CTXS
) is slated to release its third-quarter 2012 results on
Wednesday, October 24, after the closing bell. The current Zacks
Consensus Estimate for the third quarter is pegged at 49 cents,
representing a growth of 0.77% from the year-ago quarter.
With respect to earnings surprise, Citrix has outperformed the
Zacks Consensus Estimate in all the last four quarters with an
average beat of 9.54%
Second-Quarter Performance
On July 26, 2012, Citrix declared its financial results for
the second quarter of fiscal 2012 beating the Zacks Consensus
Estimates. GAAP net income, in second-quarter 2012, was $92
million or 49 cents per share compared with $81.9 million or 43
cents per share in the prior-year quarter. Quarterly adjusted
earnings per share of 56 cents were miles ahead of the Zacks
Consensus Estimate of 47 cents.
Second-quarter net revenue was $615.2 million, up 15.9% year
over year, beating the Zacks Consensus Estimate of $613 million.
Gross margin in the second quarter of 2012 was 84.7% compared
with 86.5% in the year-ago quarter. Quarterly operating margin
was 13.4% compared with 18% in the prior-year quarter.
Agreement of Estimate Revisions
In the last 30 days, out of 16 estimates there were no
estimate revisions in either direction for the third and fourth
quarter of 2012. Likewise, out of 16 estimates there were no
revisions in either direction for 2012. However, for 2013,
out of 16 estimates, two estimates saw downward rivision.
Magnitude of Estimate Revisions
Over the last 30 days, the current Zacks Consensus Estimate
has remained in line with the previous EPS estimate of 49 cents
and 68 cents, respectively.
Similarly, for fiscal 2012, the current Zacks Consensus
Estimate was in line with the previous EPS estimate of $2.15.
However, for fiscal 2013, the current EPS estimate was a penny
below the earlier estimate of $2.52
Our Take
We believe that the continuous launch of applications for
business clients coupled with huge growth opportunity in
virtualization and cloud computing market will act as a positive
catalyst for the company going forward. However, sluggish
economic growth coupled with stiff competition from
Vmware, Inc.
(
VMW
) may act as headwinds for the company going forward.
Additionally, high cost associated with virtualization may
restrict the long-term prospect of Citrix.
Currently, Citrix Systems has a Zacks #4 Rank, implying a
short-term Sell rating on the stock.
CITRIX SYS INC (CTXS): Free Stock Analysis
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