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What: Flextronics International
So What: Yesterday the company released adjusted earnings of $0.23 per share, which beat analyst estimates of $0.20. Quarterly revenue was up 27% to $7.4 billion and guidance of $7.5 billion to $7.7 billion was above estimates.
Now What: Analysts have been concerned that a low 2.9% operating margins leaves little room for error in Flextronics business but this hasn't slowed Flextronics down. With revenue gaining momentum and management pushing toward a higher operating margin of 3.5% I see an undervalued company waiting to breakout. I see this move as a buying opportunity because of solid results and management that is aggressively buying back shares with free cash flow.
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