Calix (CALX) to Report Q3 Earnings: What's in the Cards?
Calix, Inc. CALX is scheduled to report third-quarter 2020 results on Oct 20, after the closing bell. In the June quarter, the company delivered an impressive positive earnings surprise of 133.3%. Notably, the company has a trailing four-quarter positive earnings surprise of 59.7%, on average.
Despite the COVID-19 adversities, the San Jose, CA-based telecommunications service provider is expected to have recorded higher revenues on a year-over-year basis on the back of disciplined operating expense management with favorable product and customer mix. Higher Calix Cloud revenues with the rapid commercialization of innovative technology solutions like Revenue EDGE are expected to have led to accelerated network deployments supported by accretive partnerships with various service providers.
Factors at Play
During the quarter under review, the company made major enhancements to its Revenue EDGE solution. The developments impacted all the elements of Revenue EDGE, namely — Calix Marketing Cloud, EDGE Enablement, and the BLAST ultimate Wi-Fi experience — which helped marketers to speed up the deployment of targeted marketing campaigns. Markedly, this improved the overall broadband experience for customers.
The company also unveiled Automated Network Service Provisioning, a new feature of the Services Management Connector. This latest enhancement accelerates time-to-market for service providers, and boosts labor and operational savings to eliminate network complexities. To ensure smooth functioning of business operations amid COVID-19 imposed lockdowns, Calix expanded its work-from-anywhere policy. The policy fueled growth with cross-functional engagement activities on a remote basis supported by a flexible leadership. This is likely to get reflected in the upcoming results.
Further, it launched the first carrier-class Wi-Fi 6 solution — GigaSpire BLAST u4 — to provide network security for an all-new smart home infrastructure. The company also partnered with various network vendors to drive its growth momentum. It collaborated with companies like West Carolina Tel, Cumberland Connect, Jade Communications and Wisper Internet during the quarter. Such developments are likely to have had a positive impact on the company’s top line in the quarter to be reported.
For the September quarter, the Zacks Consensus Estimate for total revenues is pegged at $129 million, which indicates increase of 13.2% from the year-ago quarter’s reported figure. Adjusted earnings per share are pegged at 20 cents, which suggests a drastic surge of 233.3% from the prior-year quarter’s recorded figure.
What Our Model Says
Our proven model doesn’t conclusively predict an earnings beat for Calix this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Earnings ESP: Calix’s Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00% as both are pegged at 20 cents.
Zacks Rank: Calix currently carries a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Calix, Inc Price and EPS Surprise
Stocks to Consider
Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
PulteGroup, Inc. PHM is slated to release third-quarter 2020 results on Oct 22. It has an Earnings ESP of +5.99% and currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
NextEra Energy, Inc. NEE is scheduled to release third-quarter 2020 results on Oct 21. The company has an Earnings ESP of +1.36% and carries a Zacks Rank #2, at present.
Abbott Laboratories ABT has an Earnings ESP of +5.30% and a Zacks Rank of 2. The company is set to report third-quarter 2020 results on Oct 21.
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