The 10-second takeaway
For the quarter ended June 30 (Q2), Cavium met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly. Non-GAAP earnings per share grew significantly. GAAP loss per share shrank.
Margins grew across the board.
Cavium reported revenue of $74.2 million. The 18 analysts polled by S&P Capital IQ hoped for revenue of $74.1 million on the same basis. GAAP reported sales were 34% higher than the prior-year quarter's $55.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
EPS came in at $0.23. The 18 earnings estimates compiled by S&P Capital IQ predicted $0.22 per share. Non-GAAP EPS of $0.23 for Q2 were 229% higher than the prior-year quarter's $0.07 per share. GAAP EPS were -$0.08 for Q2 compared to -$0.24 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
For the quarter, gross margin was 58.3%, 310 basis points better than the prior-year quarter. Operating margin was -7.2%, much better than the prior-year quarter. Net margin was -5.8%, much better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $78.8 million. On the bottom line, the average EPS estimate is $0.26.
Next year's average estimate for revenue is $305.7 million. The average EPS estimate is $0.93.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 76 members out of 109 rating the stock outperform, and 33 members rating it underperform. Among 43 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 35 give Cavium a green thumbs-up, and eight give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cavium is outperform, with an average price target of $37.06.
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