Communication network solution provider, ADTRAN Inc. (ADTN), posted mixed financial numbers for the third-quarter of 2014. Earnings were on par with the Zacks Consensus Estimate while the top line significantly lagged the same.
The Zacks Rank #5 (Strong Sell) stock posted adjusted earnings per share of 22 cents that came in line with the Zacks Consensus Estimate but declined 24.1% year over year.
On a GAAP basis, the company delivered earnings of 21 cents a share, down 25% from 28 cents in the prior-year quarter.
Total revenue of this Huntsville, Alabama-based company also declined 8.2% to $162.9 million, lagging the Zacks Consensus Estimate of $174 million.
ADTRAN witnessed sequential increase in domestic carrier business. However, the upside was overshadowed by the sluggish performance in the European region and a soft enterprise-spending atmosphere. ADTRAN, however, expects improvement in results from the beginning of 2015 as the company forecasts re-acceleration in carrier expenditure both in the U.S. and Europe.
Gross margin came in at 48%, up 150 basis points year over year. However, operating income registered a steep decline of 27.4% year over year to $12.5 million. Operating margin was 7.7% against 9.7% in the prior-year quarter.
At the end of the third quarter, ADTRAN generated $18 million in cash from operations compared with $22.6 million in third-quarter 2013. The company exited the reported quarter with cash and cash equivalents of $58.4 million, short-term investments of $55.6 million and stockholders’ equity of $566.4 million.
The company’s board of directors declared a cash dividend of 9 cents per share for the quarter which will be paid on Nov 13, 2014 to shareholders of record as of Oct 30.
Other Stocks to Consider
Better-ranked stocks in this industry that warrant a look include Nokia Corporation (NOK), Calix Inc. (CALX) and Aruba Networks, Inc. (ARUN). All three carry a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment