Arris Group Earnings Preview

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After beating estimates last quarter by $0.07, Arris Group (NAS: ARRS) has set the standard for itself. The company will unveil its latest earnings on Wednesday, Oct. 26. Arris Group is a global communication technology company specializing in the design and engineering of broadband network solutions.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Arris Group with seven of 12 analysts rating it hold. Analysts don't like Arris Group as much as competitor NetGear overall. Five out of seven analysts rate NetGear a buy compared to five of 12 for Arris Group. Analysts still rate the stock a hold, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $280.8 million in revenue this quarter. That would represent a rise of 2.4% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.18 per share. Estimates range from $0.16 to $0.19.

What our community says:
CAPS All-Stars are solidly behind the stock with 97.5% awarding it an "outperform" rating. The community at large backs the All-Stars with 96.4% granting it a rating of "outperform." Fools are keen on Arris Group and haven't been shy with their opinions lately, logging 231 posts in the past 30 days. Arris Group has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
Arris Group's income has fallen year over year by an average of 39% over the past five quarters.

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

40.2%

36.3%

36.2%

37.2%

Operating Margin

9.6%

5.7%

6.7%

8.7%

Net Margin

6.3%

4.3%

4.3%

5.1%

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At the time this article was published

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