Supertex Earnings Preview

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After beating estimates last quarter by $0.03, Supertex (NAS: SUPX) has set the standard for itself. The company will unveil its latest earnings on Tuesday, Jan. 24. Supertex designs, develops, manufactures, and markets integrated circuits, utilizing state-of-the-art high voltage DMOS, HVCMOS and HVBiCMOS analog and mixed signal technologies.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Supertex with five of six analysts rating it hold. Analysts don't like Supertex as much as competitor IXYS overall. Three out of three analysts rate IXYS a buy compared to one of six for Supertex. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $14.2 million in revenue this quarter. That would represent a decline of 27.7% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.02 per share. Estimates range from a loss of $0.06 to a profit of $0.11.

What our community says:
CAPS All-Stars are solidly behind the stock with 94.6% granting it an "outperform" rating. The community at large backs the All-Stars with 89.5% giving it a rating of "outperform." Fools are keen on Supertex, though the message boards have been quiet lately with only 20 posts in the past 30 days. The bullish CAPS rating of five out of five stars for Supertex outpaces Fool enthusiasm for the company.

Management:
Supertex's income has fallen year over year by an average of 10.4% over the past five quarters. Revenue has fallen for the past three quarters. The company's gross margin shrank by 5.8 percentage points in the last quarter. Revenue fell 24.1% while cost of sales fell 14.1% to $8.4 million from a year earlier.

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

50.3%

50.2%

50.7%

52.5%

Operating Margin

15.3%

11.1%

8.7%

16.0%

Net Margin

10.1%

9.2%

8.3%

14.5%

One final thing: If you want to keep tabs on Supertex movements, and for more analysis on the company, make sure you add it to your Watchlist.

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Earnings estimates provided by Zacks.

At the time this article was published

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