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PCTEL (PCTI) to Report Q2 Earnings: What's in the Cards?

PCTEL, Inc. PCTI is scheduled to report second-quarter 2020 results on Aug 6, after the closing bell. In the last reported quarter, adjusted earnings were in line with the Zacks Consensus Estimate. Notably, the company has a trailing four-quarter earnings surprise of 33.9%, on average.

The Bloomingdale, IL-based telecom equipment company is expected to have recorded lower revenues on a year-over-year basis due to supply chain disruptions as a result of COVID-19 adversities. However, PCTEL is well positioned to benefit from its broad portfolio of competitive products for mission critical applications and robust balance sheet on the back of an efficient cost structure for long-term growth.

Let’s discuss the factors that are likely to get reflected in the upcoming quarterly announcement.

Factors at Play

During the quarter under review, the company launched Trooper TRP-20INT antenna platform for seamless installations of complex RF communications systems on 2020 police sports utility vehicles. With best-in-class capabilities to operate under harsh environments, the new-age multi-band antennas have been specifically designed to support critical communications in Intelligent Transportation Systems (ITS) and FirstNet public safety.

Impressively, the company revealed the modernized version of a wide spectrum multi-band antenna — PCTWSLMR-2. This full spectrum LMR mobile antenna provides interoperability among emergency response personnel and features an impact resistant design to offer maximum durability for critical communications installations. Despite such innovative product launches, the company is likely to witness top-line contraction due to lower demand amid the virus outbreak. In addition, escalated costs associated with new product launches are likely to have affected profitability of the company in the quarter to be reported.

For the June-end quarter, the Zacks Consensus Estimate for total revenues is pegged at $20 million, which indicates decline of 13% from the year-ago quarter’s reported figure. Adjusted earnings per share are pegged at 8 cents, which calls for a decline of 38.5% from the prior-year quarter’s recorded figure.

What Our Model Says

Our proven model doesn’t conclusively predict an earnings beat for PCTEL 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: PCTEL’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 8 cents.

PCTEL, Inc. Price and EPS Surprise

PCTEL, Inc. Price and EPS Surprise

PCTEL, Inc. price-eps-surprise | PCTEL, Inc. Quote

Zacks Rank: PCTEL currently has a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

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:

Bonanza Creek Energy, Inc. BCEI is slated to release second-quarter 2020 results on Aug 6. It has an Earnings ESP of +13.66% and currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Pacira BioSciences, Inc. PCRX is scheduled to release second-quarter 2020 results on Aug 6. The company has an Earnings ESP of +28.42% and carries a Zacks Rank #2, at present.

Houghton Mifflin Harcourt Company HMHC has an Earnings ESP of +13.21% and a Zacks Rank of 2. The company is set to report second-quarter 2020 results on Aug 6.

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