The 10-second takeaway
For the quarter ended June 30 (Q2), Arris Group beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share was unchanged.
Margins dropped across the board.
Arris Group booked revenue of $349.3 million. The eight analysts polled by S&P Capital IQ anticipated sales of $340.4 million on the same basis. GAAP reported sales were 31% higher than the prior-year quarter's $265.8 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 $0.25. The 10 earnings estimates compiled by S&P Capital IQ averaged $0.22 per share. GAAP EPS of $0.13 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 33.9%, 630 basis points worse than the prior-year quarter. Operating margin was 8.0%, 160 basis points worse than the prior-year quarter. Net margin was 4.3%, 200 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $343.1 million. On the bottom line, the average EPS estimate is $0.25.
Next year's average estimate for revenue is $1.33 billion. The average EPS estimate is $0.92.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 750 members out of 780 rating the stock outperform, and 30 members rating it underperform. Among 142 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 135 give Arris Group a green thumbs-up, and seven give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Arris Group is outperform, with an average price target of $14.31.
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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.