Monotype Imaging Holdings Earnings Preview

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Investors are on the edge of their collective seat, hoping that Monotype Imaging Holdings (NAS: TYPE) will top analyst expectations for the fifth consecutive quarter. The company will unveil its latest earnings Thursday. Monotype Imaging Holdings is a global provider of text imaging solutions. The company's technologies and fonts enable the display and printing of high-quality digital text.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Monotype Imaging Holdings, with five of six rating it a buy and the remainder rating it a hold. Analysts don't like Monotype Imaging Holdings as much as competitor Bitstream overall. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $31.6 million in revenue this quarter. That would represent a rise of 7.3% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.20 per share.

What our community says:
CAPS All-Stars are in strong support of the stock, with 92.9% assigning it an "outperform" rating. The majority of the Fools agree with the All-Stars, with 62.5% giving it an "outperform" rating. Fools are impressed with Monotype Imaging Holdings, though the message boards have been quiet lately with only six posts in the past 30 days. Monotype Imaging Holdings' bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Monotype Imaging Holdings' profit has risen year-over-year by an average of 50.5% over the past five quarters. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Margins illustrate how efficiently a company captures portions of sales dollars. Monotype Imaging Holdings' gross margins, which reflect the total sales revenue that the company retains after costs decreased year-over-year in the last two quarters. See how Monotype Imaging Holdings has been doing for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

89.2%

87.9%

90.6%

90.5%

Operating Margin

31.2%

31.2%

32.0%

34.7%

Net Margin

19.5%

18.0%

18.3%

20.9%

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