Diodes Earnings Preview

Motley Fool Staff
Updated

Diodes (NAS: DIOD) managed to meet estimates last quarter, but investors hope that it will surpass expectations this quarter. The company will unveil its latest earnings on Tuesday. Diodes is a designer, manufacturer, and supplier of high-quality, application-specific standard products within the semiconductor markets and in the consumer electronics, computing, communications, industrial, and automotive markets.

What analysts say:

  • Buy, sell, or hold?: Analysts are bullish on Diodes as five analysts rate it as a buy and only one analyst rates it as a sell. Analysts don't like Diodes as much as competitor Microsemi overall.

  • Revenue forecasts: On average, analysts predict $164.5 million in revenue this quarter. That would represent a rise of 0.9% from the year-ago quarter.

  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.34 per share. Estimates range from $0.31 to $0.37.

What our community says:
CAPS All-Stars are solidly behind the stock with 95.8% assigning it an outperform rating. The community at large agrees with the All-Stars with 94.6% granting it a rating of outperform. Fools have embraced Diodes, though the message boards have been quiet lately with only 80 posts in the past 30 days. Despite the majority sentiment in favor of Diodes, the stock has a middling CAPS rating of three out of five stars.

Management:
Diodes' profit has risen year over year by an average of 77.4% over the past five quarters. The company's gross margin shrank by 3.1 percentage points in the last quarter. Revenue rose 13.8% while cost of sales rose 19.3% to $114.2 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

32.8%

35.5%

38.3%

37.4%

Operating Margin

14.9%

17.5%

19.7%

18.3%

Net Margin

10.6%

12.2%

14.6%

13.0%

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

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At the time thisarticle was published

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