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Does The Street Have Harmonic Figured Out?

By Seth Jayson – Updated Apr 10, 2017 at 12:47PM

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Checking expectations

Harmonic (Nasdaq: HLIT) is expected to report Q2 earnings on July 23. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Harmonic's revenues will decrease -17.6% and EPS will decrease -66.7%.

The average estimate for revenue is $109.3 million. On the bottom line, the average EPS estimate is $0.02.

Revenue details
Last quarter, Harmonic logged revenue of $101.7 million. GAAP reported sales were 13% lower than the prior-year quarter's $116.4 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at -$0.02. GAAP EPS were $0.06 for Q1 versus -$0.06 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 45.5%, 220 basis points better than the prior-year quarter. Operating margin was -14.1%, 560 basis points worse than the prior-year quarter. Net margin was 6.3%, much better than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $457.8 million. The average EPS estimate is $0.15.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 290 members out of 309 rating the stock outperform, and 19 members rating it underperform. Among 58 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 56 give Harmonic 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 Harmonic is hold, with an average price target of $5.75.

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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. The Motley Fool has no position in any of the stocks mentioned. 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.

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