Mapping software maker Navteq (NYSE:NVT) reports Q1 2007 earnings results on Tuesday. To help get you ready to make sense of it, today we provide a key to the company's earnings map, which you can study over the weekend.

What analysts say:

  • Buy, sell, or waffle? Eighteen analysts read Navteq, with half rating it a buy, eight more a hold, and one a sell.
  • Revenues. On average, they're looking for 22% sales growth to $149 million.
  • Earnings. Profits are predicted to rise 12% to $0.19 per share.

What management says:
In the February earnings report, CEO Judson Green described last year's performance as alternately "exciting" and "challenging." To find out why, read our review of the 2006 earnings report.

As for what to expect in Tuesday's news, we'll be seeing Navteq's revenues inflated, and its earnings diluted, by the effects of two recent acquisitions: The Map Network and "personalized traffic information" provider Traffic.com. On the plus side, the weak U.S. dollar, combined with the fact that Navteq makes 62% of its sales to customers such as BP (NYSE:BP), DaimlerChrysler (NYSE:DCX), Honda (NYSE:HMC), Toyota (NYSE:TM), Nokia (NYSE:NOK), and Siemens (NYSE:SI) outside the U.S., should give it some favorable currency exchange rate effects.

What management does:
The boost from 2005 tax benefits now subsided, it will be some time before Navteq regains the 30%-plus rolling net margin we saw for much of last year. As a matter of fact, with management predicting higher revenue and lower profits, I wouldn't be surprised to see the most recent trend in rising net margin reversed on Tuesday.

Margin

9/05

12/05

4/06

7/06

10/06

12/06

Gross

52.8%

52.4%

54.3%

54.1%

54.3%

52.6%

Operating

28.7%

28.7%

27.3%

26.3%

26.7%

28.4%

Net

33.8%

34.4%

33.1%

32.0%

17.3%

18.9%
All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.

One Fool says:
That said, Fool co-founder and Motley Fool Stock Advisor co-analyst David Gardner still thinks the firm's rolling up of businesses in the digital mapping space is a good thing, long-term. What will interest me most in Tuesday's news is just how much of that "good" will accrue to Navteq's outside shareholders. As I mentioned in last quarter's earnings write-up, the firm predicts that shares outstanding will average 100 million this year, and it predicts as much as $18 million in stock options costs this year. That could mean up to 7.5% share dilution, which seems excessive.

Then again, in a press release earlier this month, we learned that Navteq's purchase of Traffic.com will cost it $49 million in cash and 4.3 million shares of Navteq stock. Depending on whether the stock portion of the purchase price figured into management's projection for stock dilution back in February, it now seems possible that Navteq meant there will be no net options dilution this year, and that the shares issued to buy Traffic.com will make up all of the increase in diluted shares outstanding to 100 million.

With any luck, Navteq will explain on Tuesday just how all this is going to work, and whether I'm reading between the lines correctly.

What did we expect from Navteq last quarter, and what did we get? Find out in:

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Fool contributor Rich Smith does not own shares of any company named above. The Fool has a disclosure policy.