The 10-second takeaway
For the quarter ended Feb. 3 (Q1), Avago Technologies met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew slightly. Non-GAAP earnings per share grew. GAAP earnings per share stayed the same.
Margins dropped across the board.
Avago Technologies notched revenue of $576.0 million. The 18 analysts polled by S&P Capital IQ anticipated a top line of $576.2 million on the same basis. GAAP reported sales were the same as the prior-year quarter's.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.65. The 16 earnings estimates compiled by S&P Capital IQ predicted $0.60 per share. Non-GAAP EPS of $0.65 for Q1 were 4.8% higher than the prior-year quarter's $0.62 per share. GAAP EPS of $0.50 were the same as the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 50.3%, 10 basis points worse than the prior-year quarter. Operating margin was 21.7%, 190 basis points worse than the prior-year quarter. Net margin was 21.7%, 50 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $585.4 million. On the bottom line, the average EPS estimate is $0.65.
Next year's average estimate for revenue is $2.44 billion. The average EPS estimate is $2.77.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 96 members out of 101 rating the stock outperform, and five members rating it underperform. Among 22 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 22 give Avago Technologies a green thumbs-up, and give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Avago Technologies is outperform, with an average price target of $40.80.
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