Brocade Communications Systems
The 10-second takeaway
For the quarter ended Jan. 26 (Q1), Brocade Communications Systems beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share shrank to a loss.
Gross margins expanded, operating margins expanded, net margins contracted.
Brocade Communications Systems notched revenue of $588.7 million. The 24 analysts polled by S&P Capital IQ expected sales of $575.6 million on the same basis. GAAP reported sales were 5.0% higher than the prior-year quarter's $560.6 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 $0.21. The 26 earnings estimates compiled by S&P Capital IQ predicted $0.16 per share. GAAP EPS were -$0.05 for Q1 versus $0.12 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 63.5%, 200 basis points better than the prior-year quarter. Operating margin was 15.8%, 340 basis points better than the prior-year quarter. Net margin was -3.6%, 1,400 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $563.0 million. On the bottom line, the average EPS estimate is $0.15.
Next year's average estimate for revenue is $2.31 billion. The average EPS estimate is $0.63.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 725 members out of 770 rating the stock outperform, and 45 members rating it underperform. Among 112 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 106 give Brocade Communications Systems a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Brocade Communications Systems is hold, with an average price target of $6.30.
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