CalAmp Corp. (NASDAQ:CAMP) will release its operating results for its fiscal 2015 first quarter after the market close on Tuesday, July 1, 2014. In addition, the Company will host a conference call at 4:30 p.m. Eastern (1:30 p.m. Pacific) on July 1, 2014 to discuss its financial results.
Wall Street anticipates that the Wireless Technology company will earn $0.18 per share for the quarter, which is $0.02 more than last year's profit of $0.16 per share. iStock expects CAMP to top Wall Street's consensus number, the iEstimate is $0.19.
Sales, like earnings, are expected to edge higher, increasing 7.9% year-over-year (YoY). CalAmp's consensus revenue estimate for Q1 is $57.89 million; more than last year's $53.75 million.
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CalAmp develops and markets wireless technology solutions that deliver data, voice and video for critical networked communications and other applications. The Company has two business segments: Wireless DataCom, which serves commercial, industrial and government customers, and Satellite, which focuses on the North American Direct Broadcast Satellite (DBS) market.
iStock is not alone in expecting a bullish surprise. On the eve of earnings, FBR Capital says CalAmp's guidance for Q1 could be conservative. The brokers believe investors should step in front of the announcement and own the stock.
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FBR might have a point based on CAMP's recent history of bullish surprises and earnings-driven price sensitivity.
CalAmp bypassed the street's outlook for 10 consecutive quarters, averaging 54% more in profits than forecasted. The range of positive surprises in the timeframe was 7.69% to 200% above expectations.
The stellar bottom-line results had investors bidding up shares in the days surrounding six of the last 10 quarterly checkups. Let's go with the bad news first. CAMP traded flat once and backpedalled three times, losing -3.6%, -9.30, and -11.70% in the three days before and after the three red EPS announcements.
On to the good stuff… CAMP rocked higher six of the last 10, including three in a row, which includes an out-of-this-world 51.9% rally last quarter. The average gain for the half-dozen buying frenzies averaged 21.47% with a range of 10.7% to the already mention 51.9%.
There is another reason to believe FBR might be right based CAMP's recent annual report. The income statement shows a strong investment in research & development along with selling. Meanwhile, cost of revenue grew at a slower pace than sales i.e. fatter gross profit margins. If the commitment to R&D and sales pays off with reduced costs, it means big profits.
Overall: The iEstimate, FBR's belief and CalAmp Corp.'s (NASDAQ:CAMP) earnings and price performance history suggest CAMP's reward to risk ratio favors owning the wireless company pre-announcement.
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