We should think
we can get
by with a
setback or two:

the lawn makes
a life of
starting over and
swirly bugs

in dusk air,
prey, get where
they're going
changing course.
--A.R. Ammons, "Fortitude"

Wednesday morning, quick-release circuit board manufacturer TTM Technologies (NASDAQ:TTMI) shoots out a fresh earnings report. There's some merger indigestion and the industry's in a global funk. But as the National Poetry Month contribution above says, it's only temporary.

What analysts say:

•  Buy, sell, or waffle? Only seven Wall Street analysts follow this small-cap stock today. Two of them are buying, two selling, and the other three say, "Hold it!" In our Motley Fool CAPS investor community, it's a three-star stock, based on input from nearly 150 players.

•  Revenues. Last year's $72.7 million will look tiny next to this period's net sales. The official guidance range goes from $168 million to $174 million, and the analyst consensus falls at the lower end of that with $169 million.

•  Earnings. Wall Street set its sights on $0.15 per share, right in the middle of the $0.13-to-$0.18 guidance range. Either way, it's a bleaker outlook than the $0.21 of the year-ago period.

What management says:
Of course, the reason for the fattened revenues is that TTM recently merged with another circuit board maker nearly its own size. It's the old Printed Circuit Group of Tyco (NYSE:TYC), and TTM CEO Kent Alder updated us on the integration process in the last earnings release.

"We continue to make rapid and significant progress toward our goal of integrating TTM Technologies and the Printed Circuit Group as soon as possible," Alder said. "In addition, TTM's exclusive focus on printed circuit boards and backplane assembly enables us to bring greater operating efficiency and productivity to all aspects of the business.

"The acquisition of PCG provides us with a significant opportunity to cross-sell TTM's quick-turn capabilities to the PCG customer base. We are seeing strength in the networking and military markets. We gained about 500 customers through the acquisition, and we added 30 new customers during the quarter."

What management does:
The original TTM was a more efficient and profitable operation than the Tyco group, or for that matter than the combined entity for the time being. Also, last quarter included a fair amount of merger-related costs, as will this quarter. I'd expect the margins to resume their march skyward eventually as management gets a better handle of the new operations, and as the slower production lines have some of TTM's quick-turn mojo rubbed off on them. But not yet.

Margins

10/2005

12/2005

4/2006

7/2006

10/2006

12/2006

Gross

22.6%

22.4%

23.8%

26.5%

28.1%

25.4%

Operating

10.9%

11.9%

13.8%

16.9%

19.3%

15.4%

Net

7.9%

12.8%

13.9%

15.5%

17%

9.5%

FCF/Revenue

6.8%

9.6%

10.6%

12.4%

12%

5.1%
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:
Given the wobbly state of interlocking industries like semiconductors and mobile handsets, TTM is likely to land near the bottom end of its guidance ranges. As a major parts supplier to gadget makers like Motorola (NYSE:MOT) and Cisco (NASDAQ:CSCO), TTM sits on the same link of the food chain as Texas Instruments (NYSE:TXN) or Analog Devices (NYSE:ADI), and should see an upswing right about when they do. TI has said that the bottom of this sector trough has been reached -- let's see how TTM feels about that issue Wednesday morning.

TTM Technologies is a Motley Fool Stock Advisor pick, and Tyco an Inside Value selection.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure will help you find the road ahead.