Tag Archives: earnings

Zebra Technologies Mauled By Lousy Q1 Report, Gets Price Target Cut

Zebra Technologies ( ZBRA ), a maker of systems for managing inventory and assets, fell for the second straight day on Wednesday following a weak first-quarter report. Baird analyst Richard Eastman maintained his outperform rating on Zebra stock but slashed his price target to 64 from 87. Zebra slipped a fraction to 51.42 on the stock market today . On Tuesday, Zebra shares tumbled nearly 18% after the Lincolnshire, Ill.-based company reported Q1 results. Zebra is now at a two-year low. But Eastman says Zebra stock appears oversold. Zebra management is suffering from a credibility gap and confidence issue after a series of quarterly disappointments, he said. “In our view, shares remain attractively valued but (the company will) likely need to deliver consistent execution, meet or exceed expectations, including visible operating leverage, net synergies and free-cash-flow generation, to propel a recovery,” Eastman said. Zebra blamed a spending pause by customers and channel partners for its Q1 weakness and reduced guidance. The company’s retail industry business was most affected. In the March quarter, Zebra earned $1.01 a share excluding items on sales of $847 million. Analysts polled by Thomson Reuters were looking for $1.22 EPS on $879 million in sales. On a year-over-year basis, earnings per share fell 27% and sales dropped 5%. It was the company’s first decline for either metric in the past 12 quarters. “It was clearly a challenging quarter as the softening demand we began to see in late 2015, particularly in North America, unexpectedly persisted through the end of the first quarter,” CEO Anders Gustafsson said on Zebra’s earnings conference call with analysts. Given a “cautious enterprise spending environment,” Zebra lowered its outlook for Q2 and the full year, Gustafsson said. Zebra makes technology for monitoring supply chains and tracking assets and transactions using RFID tags and bar codes.

Tesla Partner Nvidia’s Q1 Sales Seen Speeding Faster Than Most

Wall Street expects Tesla Motors ( TSLA ) partner Nvidia ( NVDA ) to post double-digit sales growth for just the second time in the past six quarters, as well as its biggest earnings growth in five quarters, when the company reports Q1 earnings Thursday. Nvidia stock has zoomed since Feb. 12, up 40% since  Facebook ( FB )-owned Oculus Rift released its first virtual-reality headset. Nvidia and rival Advanced Micro Devices ( AMD ) are the recommended graphics-chip providers for laptops that work with the headsets. Nvidia stock rose a fraction Wednesday to 36.06 ahead of its Q1 report due after the close. For Q1, the consensus of 26 analysts polled by Thomson Reuters expect Nvidia to report $1.26 billion in sales and 32 cents earnings per share ex items, up a respective 10% and 33% vs. the year-earlier quarter. Sales would decelerate from 12% growth in Q4 but top the four previous quarters. Earnings last climbed above the 30%-growth mark in March 2015. Nvidia’s Q1 report comes a week after the chipmaker and Samsung called for a truce  in their two-year licensing battle. It also follows Tesla CEO Elon Musk’s call for the automaker to manufacturer 1 million electric vehicles by 2020 — a boon to Nvidia, whose chips power digital instrument and infotainment displays in the Model S. Tesla’s yet-to-be-released  Model 3 was marked by “overwhelming demand” when it began taking preorders in April, Musk and Tesla CFO Jason Wheeler told shareholders this month.

Jazz Pharma Rises As Competitive Position Grows Stronger

Specialty drugmaker Jazz Pharmaceuticals ( JAZZ ) was trading up Wednesday morning as its lead drug staved off competition until the end of 2025, even though the company missed Q1 estimates late Tuesday. Jazz has been embroiled in litigation over its narcolepsy treatment Xyrem, as seven different generic-drug makers have been challenging its aging patents. On Tuesday’s earnings conference call with analysts, CEO Bruce Cozadd said that Jazz had reached a confidential settlement with two of them, Ranbaxy and Wockhardt Bio, which would allow them to start selling generic Xyrem, but not until Dec. 31, 2025. The news led Mizuho Securities analyst Irina Koffler to upgrade Jazz Pharma stock to buy from neutral, and raise the price target to 193 from 137. “Jazz’s announcement of its late 2025 Xyrem settlements was the upgrade signal we were looking for,” Koffler wrote in a research note. Bargaining From Strength Leerink analyst Jason Gerberry raised his price target to 198 from 137 while maintaining an outperform rating. He wrote that the patent launch was a year later than he’d been modeling, and came after last month’s favorable decision from the patent office declining to institute 18 claims Ranbaxy made against Jazz’s Xyrem patent, meaning that Ranbaxy would have to take Jazz to open court instead of banking on an inter partes review (IPR) ruling set for July. “Given favorable first-half developments in the IPR dispute … we believe Jazz is well positioned to entice the other challengers to accept similar settlement terms, eliminating an important stock overhang,” Gerberry wrote in his research note. The news lifted Jazz Pharma stock as much as 5.5% in early trading on the stock market today , though by midday shares were up just 1.5%, near 150, as Jazz reported a weak first quarter. Jazz’s earnings rose 14% over the year-earlier quarter to $2.26 a share, 5 cents short of analysts’ consensus, according to Thomson Reuters. Revenue climbed 9% to $336 million, missing consensus by almost $3 million. Jazz nonetheless added 20 cents to its 2016 EPS range, now $11.10 to $11.50, while affirmed revenue guidance of $1.49 billion to $1.55 billion. The earnings hike came entirely through share repurchases. Last year, the company made $9.52 a share on $1.325 billion in sales.