The 10-second takeaway
For the quarter ended March 31 (Q1), Entropic Communications beat expectations on revenues and earnings per share.
Compared to the prior-year quarter, revenue contracted significantly and GAAP earnings per share contracted significantly.
Gross margins grew, operating margins dropped, and net margins shrank.
Entropic Communications logged revenue of $59.1 million. The 12 analysts polled by S&P Capital IQ foresaw revenue of $57.5 million on the same basis. GAAP reported sales were 17% lower than the prior-year quarter's $71.5 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.12. The 12 earnings estimates compiled by S&P Capital IQ predicted $0.11 per share on the same basis. GAAP EPS of $0.04 for Q1 were 69% lower than the prior-year quarter's $0.13 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 56.2%, 90 basis points better than the prior-year quarter. Operating margin was 12.5%, 1,260 basis points worse than the prior-year quarter. Net margin was 6.6%, 1,000 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $59.5 million. On the bottom line, the average EPS estimate is $0.11.
Next year's average estimate for revenue is $250.0 million. The average EPS estimate is $0.50.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 264 members out of 299 rating the stock outperform, and 35 members rating it underperform. Among 54 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 46 give Entropic Communications a green thumbs-up, and eight give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Entropic Communications is outperform, with an average price target of $7.90.
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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. 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.