KLA-Tencor (KLAC) to Post Q1 Earnings: What's in the Cards?

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KLA-Tencor Corporation KLAC is set to report first-quarter fiscal 2019 results on Oct 29.

The company topped the Zacks Consensus Estimate in the trailing four quarters, with an average of 7.68%.

In the last reported quarter, KLA-Tenor delivered a positive earnings surprise of 3.74%. Earnings of $2.22 per share increased 36% from the year-ago quarter and 10% sequentially.

Revenues increased 14% year over year to $1.07 billion, driven by rising demand for the company's key products and strong shipments.

For first-quarter fiscal 2019, KLA-Tenor expects revenues between $1.030 billion and $1.110 billion. Non-GAAP earnings are expected in the range of $2.04-$2.36 per share.

The company's shares have lost 24% on a year-to-date basis compared with the industry 's decline of 13.5%.

Strong Product Portfolio - A Key Catalyst

KLA-Tenor's robust product portfolio will continue to cater to the increasing demand for wafer products. Moreover, the company is expected to witness improved end-market results, especially in China.

Further, the addition of new capacity by wafer manufacturers bodes well, given increasing demand for the company's new wafer products. Additionally, KLA-Tenor's strong efforts in bringing EUV lithography technology to market via collaborating with every EUV customer remain a positive.

Shipment Forecast

Shipments of $1.07 billion in the fiscal fourth quarter, up approximately 3% sequentially, were at the high end of the company's guided range of $1.01-$1.09 billion, driven by strength in memory.

For first-quarter fiscal 2019, KLA-Tenor expects shipments within $935 million to $1.015 billion.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has good chance of beating estimates if it also has a positive Earnings ESP . The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

KLA-Tenor is unlikely to beat estimates this earnings season as the Zacks Rank #4 company has an Earnings ESP of -0.15%.

KLA-Tencor Corporation Price and EPS Surprise

KLA-Tencor Corporation Price and EPS Surprise | KLA-Tencor Corporation Quote

Stocks That Warrant a Look

Here are a few stocks worth considering, as our model shows that these have the right combination of elements to deliver an earnings beat in the upcoming releases.

Amazon.com, Inc. AMZN has an Earnings ESP of +6.56% and carries a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here.

Expedia, Inc. EXPE has an Earnings ESP of +3.73% and a Zacks Rank #1.

Advanced Micro Devices, Inc. AMD has an Earnings ESP of +2.63% and holds a Zacks Rank #3.

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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: AMZN , EXPE , AMD , KLAC

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