Micrel Earnings Preview

Micrel (Nasdaq: MCRL  ) didn't hit the Street's expectations last quarter, but investors hope it will rebound this quarter. The company will unveil its latest earnings on Thursday. Micrel and its wholly owned subsidiaries develops, manufactures, and markets analog, mixed-signal, and digital semiconductor devices.

What analysts say

• Buy, sell, or hold?: Analysts are bullish on Micrel as two analysts rate it as a buy and only one analyst rate it as a sell. Analysts don't like Micrel as much as competitor Monolithic Power Systems overall. Analysts haven't adjusted their rating of Micrel for the past three months.
• Revenue forecasts: On average, analysts predict $70.7 million in revenue this quarter. That would represent a decline of 4.3% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.16 per share. Estimates range from $0.15 to $0.16.

What our community says
CAPS All-Stars are solidly behind the stock with 87.2% giving it an outperform rating. The community at large concurs with the All-Stars with 93.6% granting it a rating of outperform. Fools are keen on Micrel, though the message boards have been quiet lately with only 38 posts in the past 30 days. Despite the majority sentiment in favor of Micrel, the stock has a middling CAPS rating of three out of five stars.

Management
Micrel's profit has risen year over year by an average of more than twofold. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q1	Q4	Q3	Q2
Gross Margin	56.1%	55.8%	57.9%	57.8%
Operating Margin	19.6%	24.7%	27.6%	25.8%
Net Margin	13.4%	18.1%	18.5%	16.7%

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