National Instruments Earnings Preview

Investors never know what to expect for National Instruments (Nasdaq: NATI  ) , as it has wavered between topping and missing analysts' estimates during the past fiscal year. The company will unveil its latest earnings on Wednesday, Oct. 26. National Instruments is a supplier of measurement and automation products that engineers and scientists use in a range of industries.

What analysts say:

• Buy, sell, or hold?: Analysts think investors should stand pat on National Instruments with three of five analysts rating it hold. Analysts don't like National Instruments as much as competitor Synopsys overall. Seven out of seven analysts rate Synopsys a buy compared to two out of five for National Instruments. Analysts haven't adjusted their rating of National Instruments for the past three months.
• Revenue forecasts: On average, analysts predict $268.5 million in revenue this quarter. That would represent a rise of 21.8% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.22 per share. Estimates range from $0.20 to $0.24.

What our community says:
CAPS All-Stars are solidly behind the stock, with 98.9% granting it an outperform rating. The community at large backs the All-Stars, with 94.9% giving it a rating of outperform. Fools are gung-ho about National Instruments, though the message boards have been quiet lately, with only 71 posts in the past 30 days. Even with a robust four out of five stars, National Instruments' CAPS rating falls a little short of the community's upbeat outlook.

Management:
National Instruments' profit has risen year over year by an average of more than fivefold over the past five 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	Q2	Q1	Q4	Q3
Gross Margin	77.9%	77.9%	77.5%	76.5%
Operating Margin	13%	15.4%	18.7%	14.4%
Net Margin	10.5%	12.8%	15.2%	12.8%

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