Harmonic Earnings Preview

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Harmonic (NAS: HLIT) hasn't been able to establish an earnings trend, bouncing between beating and falling short of estimates during the past fiscal year. The company will unveil its latest earnings on Tuesday. Harmonic designs, manufactures, and sells versatile and high-performance video products and system solutions that enable service providers to efficiently deliver the next generation of broadcast and on-demand services.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Harmonic with five of eight analysts rating it hold. Analysts don't like Harmonic as much as competitor SeaChange International overall. One out of two analysts rate SeaChange International a buy compared to three of eight for Harmonic. 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 $130.7 million in revenue this quarter. That would represent a decline of 1.6% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.05 per share. Estimates range from a loss of $0.02 to a profit of $0.10.

What our community says:
CAPS All-Stars are solidly supporting the stock, with 94.9% giving it an outperform rating. The greater community agrees with the All-Stars, as 94.3% give it a rating of outperform. Even with a robust four out of five stars, Harmonic's CAPS rating falls a little short of the community's upbeat outlook.


Management:
Revenue has now gone up for three straight quarters.

Now let's get some insight into how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The company's net margins have risen for the last two quarters year-over-year. Net margins reflect what percentage of revenue becomes profit. Here are Harmonic's reported margins for the last four quarters:

Quarter

Q4

Q3

Q2

Q1

Gross Margin

46.6%

46.1%

46.1%

46.6%

Operating Margin

4.6%

2.8%

1.0%

(0.1%)

Net Margin

3.0%

2.6%

0.3%

0.4%

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Earnings estimates provided by Zacks.

At the time this article was published

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