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Can Integrated Device (IDTI) Surprise This Earnings Season? - Analyst Blog

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Integrated Device Technology, Inc . ( IDTI ) is slated to report fiscal second-quarter 2015 results after the closing bell on Oct 27. Last quarter, the company posted a negative earnings surprise of 6.67%. Let us see how things are shaping up for this announcement.

Factors to Consider This Past Quarter

Integrated Device Technology's fiscal first-quarter 2015 earnings of 14 cents missed the Zacks Consensus Estimate by a penny.

Revenues came in at $126.3 million, up 6.5% sequentially and 7.5% on a year-over-year basis. The sequential increase in revenues was attributable to broad-based strength across all the three target markets: communications infrastructure, high performance computing and advanced power management. Revenues beat the Zacks Consensus Estimate of $125.0 million.

New product ramps in the communications market, share gains in computing (management believes that IDTI is now the market leader in DDR4 memory) and customer and design wins in the consumer market (mainly the wireless charging business) drove results in the last quarter.

The company announced a major design win at LG Electronics, which is shipping an advanced IDTI wireless receiver in its new G3 smartphone. This is generating awareness about integrated charging technology, which is likely to facilitate adoption across the market.

For the second quarter of fiscal 2015, the company expects revenues to come in at between $130 million and $136 million.

Earnings Whispers?

Our proven model does not conclusively show that Integrated Device will beat earnings estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Ranks #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 17 cents. Hence, the difference is 0.00%.

Zacks Rank: Integrated Device Technology currently carries a Zacks Rank #3 (Hold). Though Zacks Ranks #1, 2 or 3 increase the predictive power of ESP, the company's ESP of 0.00% 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

Here are some other companies, which you may consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

Facebook Inc. ( FB ) has an Earnings ESP of +6.25% and a Zacks Rank #2 (Buy).

Seagate ( STX ) has an Earnings ESP of +4.80% and a Zacks Rank #3.

Mercadolibre, Inc. ( MELI ) has an Earnings ESP of +6.25% and a Zacks Rank #3.

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INTEGR DEVICE (IDTI): Free Stock Analysis Report

SEAGATE TECH (STX): Free Stock Analysis Report

FACEBOOK INC-A (FB): Free Stock Analysis Report

MERCADOLIBRE IN (MELI): Free Stock Analysis Report

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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.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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