All last year, laser company II-VI
What analysts say:
- Buy, sell, or waffle? Three analysts give II-VI one buy rating and a pair o' holds.
- Revenue. On average, they're looking for 18% sales growth to $85.4 million.
- Earnings. Profits are predicted to grow even more, up 34% to $0.43 per share.
What management says:
The big news at II-VI last quarter (even bigger than the raw numbers) was the sterling success of II-VI's "military and materials" division. There, core growth plus a well-timed acquisition of Pacific Rare Specialty Metals & Chemicals helped to increase both profits and new orders. Defense contractors are getting increasingly interested in lasers -- and with their collaborative Airborne Laser project making steady progress, I can see why Raytheon
What management does:
That interest appears to be spurring a rise in profitability at II-VI, which has produced back-to-back quarters of increasingly strong gross and operating margins.
3/07 |
6/07 |
9/07 |
12/07 |
3/08 |
6/08 |
|
---|---|---|---|---|---|---|
Gross |
42.4% |
42.5% |
41.3% |
40.9% |
40.6% |
41.2% |
Operating |
18.5% |
19.2% |
18.3% |
18.6% |
18.7% |
19.5% |
Net |
7.2% |
14.9% |
14.6% |
20.1% |
20.1% |
20.3% |
All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.
One Fool says:
Above was all the good news we could handle in a single earnings release. However, the company was slow in including a cash flow statement with its news last quarter, eliciting a gentle chiding from yours Fool-y.
Well, the time for gentility is past. When II-VI finally included the cash flow statement as part of its 10-K filing, and the news arrived, it was not good. Operating cash flow rose a bare 3% in fiscal 2008. True, a decline in capital spending boosted free cash flow 12% -- but neither number was anywhere near what I expected based on the company's reported 69% "profits" growth under GAAP.
Suffice it to say that if II-VI fails to include a cash flow statement in tomorrow's release, I'll be considerably more skeptical as to the contents of the missing document this time around. You should be, too.
For more IV-I-I on II-VI, read: