Will Portfolio Reshuffle Help Atmel (ATML) Beat Earnings? - Analyst Blog
Atmel's successful integration of Newport Media, a leading providerof high-performance & low-power Wi-Fi and Bluetooth products,has created the industry's most comprehensive wireless portfolio ofsmart connected devices for the IoT (Internet of Things)market.
Atmel
has also joined hands with Samsung, Intel, Broadcom andDell to
establish a new industry consortium focused on improvinginteroperability
and defining the connectivity requirements for thebillions of devices
that will make up the IoT. These initiativesare likely to augment
revenues and improve earnings for Atmel.
Fast-growing touch-sensing technology is one of the major growthdrivers for Atmel's microcontroller business. The phenomenal growthis led by continued rapid use of smartphones, the rise of Androidtablets and the penetration into the latest applications includingtablets, netbooks, cameras, printers, automotive, and otherareas.
The
demand for touch-sensing is also increasing beyond thesmartphone and
tablet markets and is now being used in theindustrial market for its
point-of-sale terminals, home andbuilding automation and medical
equipment.
Moreover, Jaguar Land Rover, General Motors and Mazda
are usingAtmel's maXTouch technology. The investments that the company
hasmade in the past 18 months have significantly improved
thecompetitiveness of its product portfolio and positioned it well
forenhanced operating performance and will likely to do so in thefuture
as well.
Earnings Whispers
However, despite the
inherent strengths, our proven model does notconclusively show that
Atmel is likely to beat earnings thisquarter as it does not possess the
key ingredients for a successrecipe.
Zacks ESP:Expected
Surprise Prediction or Earnings ESP, which represents thedifference
between the Most Accurate estimate and the ZacksConsensus Estimate, is
currently pegged at 0.00%. This indicates alikely in-line earnings for
the shares.
Zacks Rank:Atmel's Zacks Rank #3 (Hold)
combined with a 0.00% ESP reduces thepredictive power of ESP. Note that
stocks with a Zacks Ranks of #1(Strong Buy), #2 (Buy) and #3 have a
significantly higher chance ofbeating earnings. The Sell-rated stocks
(#4 and #5) should never beconsidered going into an earnings
announcement, especially when thecompany is seeing negative estimate
revisions momentum.