The 10-second takeaway
For the quarter ended April 1 (Q2), Microsemi met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP loss per share contracted.
Gross margins shrank, operating margins dropped, net margins grew.
Microsemi tallied revenue of $249.3 million. The 11 analysts polled by S&P Capital IQ foresaw sales of $248.5 million on the same basis. GAAP reported sales were 20% higher than the prior-year quarter's $207.5 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 $0.46. The eight earnings estimates compiled by S&P Capital IQ anticipated $0.46 per share. GAAP EPS were -$0.06 for Q2 versus -$0.23 per share for 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 54.2%, 110 basis points worse than the prior-year quarter. Operating margin was 6.0%, 720 basis points worse than the prior-year quarter. Net margin was -1.9%, 730 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $258.5 million. On the bottom line, the average EPS estimate is $0.53.
Next year's average estimate for revenue is $1.01 billion. The average EPS estimate is $1.95.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 95 members out of 106 rating the stock outperform, and 11 members rating it underperform. Among 31 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 28 give Microsemi a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Microsemi is outperform, with an average price target of $26.20.
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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.