) is set to report first-quarter 2014 results on Apr 30. Last
quarter, it posted a 3.9% positive surprise. Let's see how things
are shaping up for this announcement.
Growth Factors This Past Quarter
FormFactor posted decent fourth quarter 2013 results with both
the top and bottom lines beating the Zacks Consensus Estimate.
Its System on Chip (SoC) business performed well in the quarter.
Overall strength in this market is currently being driven by the
shift from PC to mobile application processors where probe card
solutions are more complex and require higher parallelism.
However, the company's DRAM and Flash business posted dismal
FormFactor, a manufacturer of automated wafer probe cards used in
the semiconductor integrated circuits (ICs) manufacturing
process, is facing difficulty to recover its manufacturing costs,
given a decline in probe card demand. Therefore the company's
decision to adopt strict cost control measures and focus on the
mobile segment will likely prove to be beneficial.
For the first quarter, FormFactor expects revenues in the range
of $53.0−$57.0 million. Non-GAAP gross margin is expected to be
in the range of 23%-27%. Non-GAAP operating expenses are expected
to be $18.0-$20.0 million.
Our proven model does not conclusively show that FormFactor will
beat estimates this quarter. That is because a stock needs to
have both a positive Earnings ESP 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 a loss of 16 cents per share. Hence, the
difference is 0.00%.
: FormFactor's Zacks Rank #3 (Hold), 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 momentum.
Other Stocks to Consider
Here are some other companies, which you may want to consider as
our model shows that they have the right combination of elements
to post an earnings beat this quarter:
Advanced Energy Industries, Inc.
), with Earnings ESP of +10.00% and a Zacks Rank #1 (Strong Buy).
ON Semiconductor Corp.
), with Earnings ESP of +6.67% and a Zacks Rank #1.
Hittite Microwave Corp.
), with Earnings ESP of +1.75% and a Zacks Rank #2 (Buy).
ADV ENERGY INDS (AEIS): Free Stock Analysis
FORMFACTOR INC (FORM): Free Stock Analysis
HITTITE MICROWV (HITT): Free Stock Analysis
ON SEMICON CORP (ONNN): Free Stock Analysis
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