Schaeffer's Trading Floor Blog

Tech Earnings on Deck: ARM Holdings plc (ADR), Electronic Arts Inc., and Juniper Networks, Inc.

Taking a closer look at ARMH, EA, and JNPR ahead of their earnings results

by 7/21/2014 2:29 PM
Stocks quoted in this article:

The thick of earnings season is upon us, and this week, a number of notable blue chips, as well as an onslaught of tech names, will be hitting the confessional. Representing technology firms on the earnings stage will be semiconductor concern ARM Holdings plc (ADR) (NASDAQ:ARMH), video game maker Electronic Arts Inc. (NASDAQ:EA), and network infrastructure operator Juniper Networks, Inc. (NYSE:JNPR). Here's a quick look at this trio of names as earnings approach.

  • ARMH has exceeded analysts' bottom-line estimates in each of the past eight quarters, resulting in an average single-session post-earnings gain of 3.3%. Ahead of tomorrow morning's event, Citigroup said the company could surprise to the upside with its second-quarter results, but the analysts expect challenges in the current quarter due to royalties. This skepticism on the part of Citigroup has had little impact on ARMH in today's session, with the shares up 1% to trade at $42.77. For tomorrow's results, analysts, on average, are calling for a second-quarter profit of 26 cents per-share for ARMH -- 3 pennies more than what the company earned last year.

  • EA is 0.3% higher today to linger near $38.49 -- and tagged a five-year high of $38.62 moments ago -- after Credit Suisse this morning raised its price target for the stock by $4 to $42. If past is prologue, the security could be poised to add significantly to these gains in the wake of tomorrow night's earnings report. Specifically, over the past eight quarters, EA has, on average, added 8.5% in the session subsequent to its report -- including a 21% surge in early May. What's more, additional price-target hikes could help the equity add to its already impressive 68% year-to-date gain. Currently, the stock's consensus 12-month price target of $37.24 stands at a discount to present trading levels. For Electronic Arts Inc.'s fiscal first quarter, analysts have forecast a per-share loss of 4 cents -- a 36-cent improvement over EA's year-ago results.

  • JNPR is bucking the broad-market trend lower today, after Barron's gave a positive outlook for the company's share price over the weekend. With less than two hours left in today's session, the stock was up 2.3% at $24.56. Looking ahead to tomorrow night's quarterly earnings report, the consensus estimate is for a per-share profit of 38 cents, which is 9 cents more than what Juniper Networks, Inc. earned one year ago. Over the past eight quarters, the company has matched or exceeded analysts' profit estimates each time, and another earnings win could prompt a round of upgrades from the brokerage bunch. At present, 60% of covering analysts maintain a "hold" or "sell" recommendation toward the stock.

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