Masimo Earnings Preview

Masimo (Nasdaq: MASI  ) came in under analyst's estimates last quarter, but now have a chance to fix things this quarter. The company will unveil its latest earnings on Tuesday, Feb. 14. Masimo is a global medical technology company that develops, manufactures, and markets noninvasive patient monitoring products that improve patient care.

What analysts say:

• Buy, sell, or hold?: Analysts are bullish on Masimo as six analysts rate it as a buy and only one analyst rates it as a sell.
• Revenue Forecasts: On average, analysts predict $110.3 million in revenue this quarter. That would represent a rise of 4.5% from the year-ago quarter.
• Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.23 per share. Estimates range from $0.21-$0.25.

What our community says:
CAPS All-Stars are solidly supporting the stock, with 97.6% granting it an "outperform" rating. The community at large concurs with the All-Stars, with 94.1% assigning it a rating of "outperform." Fools are impressed with Masimo, though the message boards have been quiet lately with only 57 posts in the past 30 days. Masimo has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
Masimo's income has fallen year-over-year by an average of 2.1% over the past five quarters. Revenue has now gone up for three straight quarters. The company's gross margin shrank by 5.1 percentage points in the last quarter. Revenue rose 3% while cost of sales rose 21.2% to $35.6 million from a year earlier.

Now, a look at how efficient management has been at running the business. Traditionally, margins serve as an illustration of how efficiently a company captures portions of sales dollars. Masimo has seen declining gross margins year-over-year for the last four quarters. Gross margins reflect the total sales revenue retained after costs. Here is how Masimo has been doing for the last four quarters:

Quarter	Q3	Q2	Q1	Q4
Gross Margin	65.8%	68.7%	68.0%	70.2%
Operating Margin	18.2%	20.2%	22.5%	20.4%
Net Margin	14.3%	15.6%	15.9%	15.3%

One final thing: If you want to keep tabs on Masimo movements, and for more analysis on the company, make sure you add it to your Watchlist.

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