Motorola, Inc (MOT) is scheduled report its fiscal third quarter 2009 financial results on Thursday, October 29, 2009. In the last two quarters, the company's actual earnings positively surprised investors but nevertheless were in the negative territory.
Analysts estimates for the quarter ending September 2009 (Q3) range from a low of $-0.01 to a high of $0.03, with a consensus of $0.004. For the fiscal quarter ending September 2009, the consensus EPS forecast has increased over the past week from $0.003 to $0.004 (33.33%) and increased over the past month from $0.003 to $0.004 (33.33%). Of the 26 analysts making quarterly forecasts, 2 raised and none lowered their forecast.
Motorola's third quarter revenues are expected to be in the range of $5.8 billion to $6 billion. Net income is expected to be in the range of $38 million to $42 million. Upward revision in revenue and earnings is driven by increased expected sales (due to new product launches and decreased pricing) and improving operating and net profit margins. In the first half, the company reduced OpEx by over $1 billion year-on-year. For the full year, it anticipates an annual operating expense reduction of $1.8 billion with Mobile Devices realizing a reduction of $1.4 billion. The company's ongoing tax rate in the second quarter was 44%, while it expects the full year ongoing tax rate to decline to 34%.
On a sequential basis, the company is expected to have reduced inventory by over $200 million, compared to the second quarter. In the quarter, the company is expected to have improved its cash flow by $450 million, and increased total cash to $7 billion. With the appropriate focus on cost management and the introduction of new products in all of our businesses, we will further improve earnings in the remainder of the year 2009.
This will drive positive operating cash flow and results in a higher total cash position at the end of the year compared to the current levels. Going forward, for the fiscal year ending December 2009, the consensus EPS forecast has increased over the past week from -$0.019 to -$0.018 (5.26%) and increased over the past month from -$0.020 to -$0.018 (10.00%). Of the 26 analysts making yearly forecasts, 3 raised and 2 lowered their forecast.
The company's stock closed Friday at $8.04, compared to the 52 week range of $2.98 and $9.45. The stock seems to be trading at appropriate levels.
