We expect memory chip maker SanDisk Corp. ( SNDK ) to beat
expectations when it reports first quarter 2013 results on Apr
17.LINKEDIN CORP-A (LNKD): Free Stock Analysis
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Why a Likely Positive Surprise?
Our proven model shows that SanDisk is likely to beat earnings
because it has the right combination of two key ingredients.
Positive Zacks ESP : Earnings Surprise Prediction
or ESP (Read: Zacks Earnings ESP: A Better Method ), which
represents the difference between the Most Accurate estimate and
the Zacks Consensus Estimate, is at +9.09%. This is very meaningful
and a leading indicator of a likely positive earnings surprise for
Zacks Rank #1 (Strong Buy) : Note that stocks
with Zacks Ranks of #1, #2 and #3 have a significantly higher
chance of beating earnings. The sell rated stocks (#4 and #5)
should never be considered going into an earnings
The combination of SanDisk's Zacks Rank # 1 (Strong Buy) and
+9.09% ESP makes us very confident in looking for a positive
earnings beat on Apr 17.
What is Driving the Better Than Expected
Improved supply/demand ratio for solid state drive (SSD), strength
across OEM (original equipment manufacturer) and Retail channels
and tailwinds from a weak Yen are expected to lead to a positive
earnings surprise in the upcoming quarter.
The positive trend is evident from the trailing four-quarter
average surprise of 17.6%, which was greatly helped by the 45.6%
surprise in the last-reported quarter. This was possible mainly due
to solid recovery in the mobile embedded and retail businesses,
strength across geographies and favorable supply/demand
Other Stocks to Consider
Apart from SanDisk, we also expect earnings beat from the
Lattice Semiconductor Corp. ( LSCC ), Earnings ESP
of +100.0% and Zacks Rank #1 (Strong Buy).
Micron Technology Inc. ( MU ), Earnings ESP of
+200.0% and Zacks Rank #2 (Buy).
LinkedIn Corp. ( LNKD ), Earnings ESP
of +300.0% and Zacks Rank #3 (Hold).