Super Micro Computer Earnings Preview

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Super Micro Computer (NAS: SMCI) came in under analysts' estimates last quarter, but now has a chance to fix things this quarter. The company will unveil its latest earnings on Tuesday, Jan. 24. Super Micro Computer develops and provides high-performance server solutions based upon an innovative, modular, and open-standard architecture.

What analysts say:

  • Buy, sell, or hold?: The majority of analysts back Super Micro Computer as a buy. But with 60% of analysts rating it a buy, Super Micro Computer is still below the mean analyst rating of its nearest 10 competitors, which average 63.1% buys. Analysts don't like Super Micro Computer as much as competitor Silicon Graphics International overall. One out of one analysts rate Silicon Graphics International a buy compared to three out of five for Super Micro Computer. Analysts' rating of Super Micro Computer has stayed constant from three months' prior.
  • Revenue forecasts: On average, analysts predict $259.3 million in revenue this quarter. That would represent a rise of 7.7% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.22 per share. Estimates range from $0.21 to $0.25.

What our community says:
CAPS All-Stars are solidly backing the stock, with 96.6% assigning it an outperform rating. The community at large concurs with the All-Stars, with 92.7% awarding it a rating of outperform. Fools have embraced Super Micro Computer, though the message boards have been quiet lately, with only 77 posts in the past 30 days. Even with a robust four out of five stars, Super Micro Computer's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Super Micro Computer's profit has risen year over year by an average of 36.8% 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

Q1

Q4

Q3

Q2

Gross Margin

16%

15.4%

16.2%

16.7%

Operating Margin

5.5%

5.6%

6.5%

7%

Net Margin

3.4%

4.1%

4.6%

4.8%

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Earnings estimates provided by Zacks.

At the time this article was published

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