Electro Scientific Industries Makes Analysts Look Bad

Electro Scientific Industries (NAS: ESIO) reported earnings on Jan. 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q3), Electro Scientific Industries met expectations on revenue and NA on earnings per share.

Compared to the prior-year quarter, revenue dropped significantly, and GAAP earnings per share contracted to a loss. The profit was a surprise, as analysts had predicted a loss.

Margins contracted across the board.

Revenue details
Electro Scientific Industries chalked up revenue of $49.8 million. The three analysts polled by S&P Capital IQ anticipated sales of $50.5 million. Sales were 26% lower than the prior-year quarter's $67.2 million.


Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
Non-GAAP EPS came in at $0.02. The two earnings estimates compiled by S&P Capital IQ predicted -$0.04 per share on the same basis. GAAP EPS were -$0.07 for Q3 versus $0.08 per share for the prior-year quarter.


Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 42.5%, 220 basis points worse than the prior-year quarter. Operating margin was -6.6%, 1,350 basis points worse than the prior-year quarter. Net margin was -3.8%, 730 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $58.3 million. On the bottom line, the average EPS estimate is $0.07.

Next year's average estimate for revenue is $267.8 million. The average EPS estimate is $0.64.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 228 members out of 240 rating the stock outperform, and 12 members rating it underperform. Among 88 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 86 give Electro Scientific Industries a green thumbs-up, and two give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Electro Scientific Industries is buy, with an average price target of $17.67.

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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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