Maxim Integrated Products Beats on EPS, but GAAP Results Lag

Seth Jayson, The Motley Fool
Updated

Maxim Integrated Products (NAS: MXIM) reported earnings on April 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q3), Maxim Integrated Products met expectations on revenues and beat expectations on earnings per share.

Compared with the prior-year quarter, revenue shrank and GAAP earnings per share dropped significantly.


Margins dropped across the board.

Revenue details
Maxim Integrated Products reported revenue of $571.2 million. The 26 analysts polled by S&P Capital IQ predicted sales of $571.2 million on the same basis. GAAP reported sales were 5.9% lower than the prior-year quarter's $606.8 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.33. The 23 earnings estimates compiled by S&P Capital IQ anticipated $0.28 per share. GAAP EPS of $0.18 for Q3 were 60% lower than the prior-year quarter's $0.45 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 58.7%, 270 basis points worse than the prior-year quarter. Operating margin was 21.0%, 600 basis points worse than the prior-year quarter. Net margin was 9.5%, 1,300 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $600.9 million. On the bottom line, the average EPS estimate is $0.35.

Next year's average estimate for revenue is $2.40 billion. The average EPS estimate is $1.43.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 284 members out of 310 rating the stock outperform, and 26 members rating it underperform. Among 100 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 94 give Maxim Integrated Products a green thumbs-up, and six give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Maxim Integrated Products is outperform, with an average price target of $29.44.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings. He is the 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 don't 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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