)is set to report third-quarter fiscal 2014 results on Feb 27.
Last quarter, it posted 62.1% positive surprise. Let's see how
things are shaping up for this announcement.
Growth Factors this Past Quarter
OmniVision's second-quarter fiscal 2014 earnings were above
the Zacks Consensus Estimate driven by strong revenue growth
coupled with better gross margins and solid expense management.
Additionally, revenues were up sequentially on the back of
strength in the mobile phone and entertainment markets.
Gross margins expanded in the quarter attributable to improved
production yields for 1-megapixel and 5-megapixel products.
Operating margin of 6.3% was also up 180 basis points (bps)
sequentially and 270 bps from the year-ago quarter.
For the third quarter, OmniVision expects revenues in the
range of $310.0-$340.0 million, down 18.2% sequentially. The
company estimates GAAP earnings per share in the range of 14-30
cents and non-GAAP earnings, excluding share-based compensation
and the associated tax impact, in the range of 28-44 cents per
Our proven model does not conclusively show that OmniVision
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 21 cents. Hence, the difference is 0.00%.
OmniVisionhas a Zacks Rank #1 (Strong Buy) which, 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
Other Stocks to Consider
Investors could consider other stocks with a positive earnings
ESP and a Zacks Rank #1, 2 or 3 such as:
Baidu, Inc. (
), with Earnings ESP of +0.72% and a Zacks Rank #1 (Strong
Ship Finance International Limited
), with Earnings ESP of +52.63% and a Zacks Rank #1
Safe Bulkers, Inc.
), with Earnings ESP of +5.26% and a Zacks Rank #1
BAIDU INC (BIDU): Free Stock Analysis Report
OMNIVISION TECH (OVTI): Free Stock Analysis
SAFE BULKERS (SB): Free Stock Analysis Report
SHIP FIN INTL (SFL): Free Stock Analysis
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