Cubic Earnings Preview

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Cubic (NYS: CUB) will try to beat its earnings estimates for the fifth consecutive quarter. The company will unveil its latest earnings Tuesday. It designs, develops, manufactures, and installs products that are mainly electronic in nature, such as: equipment for use in customized military range instrumentation, training and applications systems, and automated revenue collection systems.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Cubic with three of four analysts rating it hold. Analysts don't like Cubic as much as competitor Anaren overall. Five out of five analysts rate Anaren a buy compared with one of four for Cubic. Analysts still rate the stock a Hold, but they are a bit more wary about it compared with three months ago.
  • Revenue forecasts: On average, analysts predict $335.6 million in revenue this quarter. That would represent a rise of 1.3% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.72 per share. Estimates range from $0.66 to $0.80.

What our community says:
CAPS All-Stars are solidly behind the stock with 98.6% giving it an "outperform" rating. The community at large agrees with the All-Stars with 97.6% awarding it a rating of "outperform." Fools are keen on Cubic, though the message boards have been quiet lately with only 69 posts in the past 30 days. Even with a robust four out of five stars, Cubic's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Cubic's profit has risen year over year by an average of 37.3%.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

22.5%

25.5%

20.0%

21.6%

Operating Margin

8.4%

9.6%

7.6%

9.9%

Net Margin

6.0%

7.0%

4.9%

6.9%

For all our Cubic-specific analysis, including earnings and beyond, add Cubic to My Watchlist.

Motley Fool newsletter services have recommended buying shares of Cubic.Try any of our Foolish newsletter services free for 30 days. 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.

At the time this article was published

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