Zacks Investment Research downgraded
) to a Zacks Rank #5 (Strong Sell) on Mar 12, 2014. Going by the
Zacks model, companies holding a Zacks Rank #5 have strong
chances of performing worse than the broader market.
Why the Downgrade?
Shares of II-VI Incorporated fell 4.6% after the company released
its second-quarter fiscal 2014 (ended Dec 31, 2013) results on
Jan 28. Adjusted earnings per share from continuing operations
were 13 cents, down 38.1% year over year. The bottom-line result
also fell short of the Zacks Consensus Estimate of 17
Revenues in the quarter increased 37.3% year over year to $171.8
million. The top-line growth was partially offset by an increase
of 52.1% in cost of sales leading to a contraction of roughly 670
basis points (bps) in gross margin. Operating expenses in the
quarter increased 59.3% year over year.
Fiscal second-quarter 2014 results triggered downward revisions
in earnings estimates for II-VI Incorporated. In the last 30
days, the Zacks Consensus Estimate has decreased 13.6% to 76
cents for fiscal 2014 and by 5.0% to $1.13 for fiscal 2015. The
estimate for fiscal 2014 reflects a year-over-year decline of
Disappointing second-quarter results as well as a negative
average earnings surprise of 3.3% have made us dubious about
II-VI Incorporated's performance in the coming quarters.
Other Stocks to Consider
II-VI Incorporated is a $1.03 billion company operating in the
machinery industry. Some better-ranked stocks in the industry
Franklin Electric Co., Inc.
), all of which carry a Zacks Rank #2 (Buy).
ENERSYS INC (ENS): Free Stock Analysis Report
FRANKLIN ELEC (FELE): Free Stock Analysis
II-VI INCORP (IIVI): Free Stock Analysis
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