Will These Numbers from Sonus Networks Be Good Enough for You?

Sonus Networks (Nasdaq: SONS  ) is expected to report Q3 earnings on Nov. 7. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Sonus Networks's revenues will drop -14.9% and EPS will shrink to a loss.

The average estimate for revenue is $56.5 million. On the bottom line, the average EPS estimate is -$0.03.

Revenue details
Last quarter, Sonus Networks logged revenue of $57.6 million. GAAP reported sales were 11% higher than the prior-year quarter's $51.8 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at -$0.03. GAAP EPS were -$0.04 for Q2 against -$0.02 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 56.9%, 90 basis points worse than the prior-year quarter. Operating margin was -18.7%, 570 basis points worse than the prior-year quarter. Net margin was -20.4%, 890 basis points worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $272.4 million. The average EPS estimate is -$0.04.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 373 members out of 399 rating the stock outperform, and 26 members rating it underperform. Among 62 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 55 give Sonus Networks a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Sonus Networks is outperform, with an average price target of $3.54.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On November 13, 2012, at 6:15 PM, joezada wrote:

    This company has a marginally successful product, but throughout its history it did very poorly in its Financial department. If you closely review its financial culture, you will see that it had hard time maintaining a CFO. it got audited several times for years by the FCC. The few times its EPS went positive, company persists on a spending rampage, and over hiring, and that is clearly reflected in the EPS graph above.

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