Synaptics Inc. (SYNA) is set to report second-quarter fiscal 2015 results on Jan 29. Last quarter, the company posted a negative surprise of 18.37%. The company has posted an average negative earnings surprise of 5.6% over the past four quarters.
Let’s see how things are shaping up for this quarter.
Factors to Consider
Synaptics’ robust position in the touch-based interface market is a major growth factor. Further, the company has been pursuing innovation to maintain and expand its premiere position in the human interface solutions market.
Though a key supplier of display drivers for Apple’s (AAPL) iPhone, media reports state that Synaptics has lost the contract from Samsung to provide the touch controller socket for the forthcoming Samsung Galaxy S6 to a rival company, STMicroelectronics NV (STM). The loss of this crucial contract is likely to have an adverse impact on the company.
Earnings Whispers?
Our proven model does not conclusively show that Synaptics is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is not the case here as you will see below.
Zacks ESP: Synaptics currently has an of 0.00%. This is because both the Most Accurate estimate and theEarnings ESP Zacks Consensus Estimate stand at 99 cents per share.
Zacks Rank: Synaptics has a Zacks Rank #2 (Buy), but we need to have a positive ESP as well to be confident about an earnings surprise.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Stocks to Consider
Here's a stock worth considering that, as per our model, has the right combination of elements to post an earnings beat this quarter:
- Ellie Mae, Inc. (ELLI) with Earnings ESP of +40.00% and a Zacks Rank #1 (Strong 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
Be the first to comment