The 10-second takeaway
For the quarter ended March 31 (Q1), EZchip Semiconductor beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share expanded significantly.
Margins increased across the board.
EZchip Semiconductor reported revenue of $14.4 million. The eight analysts polled by S&P Capital IQ expected a top line of $14.1 million on the same basis. GAAP reported sales were 9.4% higher than the prior-year quarter's $13.2 million.
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 $0.27. The four earnings estimates compiled by S&P Capital IQ averaged $0.25 per share. GAAP EPS of $0.18 for Q1 were 260% higher than the prior-year quarter's $0.05 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 84.9%, 750 basis points better than the prior-year quarter. Operating margin was 31.5%, 1,210 basis points better than the prior-year quarter. Net margin was 35.6%, 2,440 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $15.6 million. On the bottom line, the average EPS estimate is $0.26.
Next year's average estimate for revenue is $71.4 million. The average EPS estimate is $1.28.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 233 members out of 244 rating the stock outperform, and 11 members rating it underperform. Among 48 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 46 give EZchip Semiconductor a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on EZchip Semiconductor is outperform, with an average price target of $43.25.
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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.