F5 Networks (FFIV) Q2 Earnings: Will it Pull Off a Surprise?


Shutterstock photo

F5 Networks Inc. FFIV is set to report second-quarter 2017 results on Apr 26. Last quarter, the company posted a negative earnings surprise of 3.27%. Notably, F5 Networks outperformed the Zacks Consensus Estimate in two of the trailing four quarters with an average positive earnings surprise of 1.57%.

Let's see how things are shaping up for this announcement.

Factors to Consider

F5 Networks reported not-so encouraging first-quarter fiscal 2017 results, as the bottom line missed the Zacks Consensus Estimates and the top line beat the same by a slight margin. However, year-over-year comparisons on both counts were favorable.

It needs to be mentioned that the company's GBB pricing strategy and its BIG-IQ platform remain tailwinds. Revenue growth seems to be steady and was positively impacted by strength across all its business segments and higher software revenues.

We believe that the company's product refreshes will boost revenues, going forward. Moreover, these initiatives are expected to expand the company's total addressable market and result in client wins.

Better execution and focus on enterprise and service providers have placed F5 Networks well in the application delivery controller market. Nevertheless, a volatile spending atmosphere and competition from Juniper Networks Inc. JNPR remain concerns.

F5 Networks, Inc. Price and EPS Surprise

F5 Networks, Inc. Price and EPS Surprise | F5 Networks, Inc. Quote

Earnings Whispers

Our proven model does not conclusively show that F5 Networkswill beat earnings this quarter. This is because a stock needs to have both a positive  Earnings ESP  and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here, as you will see below.

Zacks ESP:  Both the Most Accurate estimate and the Zacks Consensus Estimate stand at $1.52 per share. Hence, the difference is 0.00%.You can uncover the best stocks to buy or sell before they're reported with our  Earnings ESP Filter .

Zacks Rank: F5 Networks carries a Zacks Rank #3. Though Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 increases the predictive power of ESP, the company's ESP of 0.00% makes surprise prediction difficult.

We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.

Here are a couple of companies which, as per our model, have the right combination of elements to post an earnings beat this quarter.

Seagate Technology PLC STX , with an Earnings ESP of +3.77% and a Zacks Rank #2. You can see  the complete list of today's Zacks #1 Rank stocks here .

AMETEK Inc. AME , with an Earnings ESP of +1.79% and a Zacks Rank #3.

More Stock News: 8 Companies Verge on Apple-Like Run                                                             

Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.

A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Seagate Technology PLC (STX): Free Stock Analysis Report

F5 Networks, Inc. (FFIV): Free Stock Analysis Report

Juniper Networks, Inc. (JNPR): Free Stock Analysis Report

AMTEK, Inc. (AME): Free Stock Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , Business , Earnings , Stocks
Referenced Symbols: STX , FFIV , JNPR , AME


More from Zacks.com

Subscribe






Zacks.com
Contributor:

Zacks.com

Equity Research
Follow on:








Research Brokers before you trade

Want to trade FX?





Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com