FEI Company Earnings Preview

FEI Company (Nasdaq: FEIC  ) will try to beat its earnings estimates for the fourth consecutive quarter. The company will unveil its latest earnings on Tuesday, August 2. FEI Company is a supplier of instruments for nanoscale imaging, analysis, and prototyping to enable research, development, and manufacturing in a range of industrial, academic, and research institutional applications.

What analysts say:

• Buy, sell, or hold?: Analysts strongly back FEI Company, with five of six rating it a buy and the remainder rating it a hold. Analysts like FEI Company better than competitor Veeco Instruments overall. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared to three months ago.
• Revenue Forecasts: On average, analysts predict $203.1 million in revenue this quarter. That would represent a rise of 39.1% from the year-ago quarter.
• Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.59 per share. Estimates range from $0.58 to $0.61.

What our community says:
CAPS All Stars are solidly behind the stock, with 99% giving it an "outperform" rating. The community at large backs the All Stars, with 96.2% granting it a rating of "outperform." Fools have embraced FEI Company, though the message boards have been quiet lately with only 82 posts in the past 30 days. FEI Company has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
FEI Company's profit has risen year over year by an average of more than threefold. Revenue has now gone up for three straight quarters. The company increased its gross margin by 3.9 percentage points in the last quarter. Revenue rose 32.1% while cost of sales rose 23.5% to $111.1 million from a year earlier.

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	43.6%	45.0%	43.5%	41.0%
Operating Margin	16.2%	15.4%	11.5%	2.4%
Net Margin	11.3%	11.5%	7.8%	11.1%

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