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Calix (CALX) to Report Q2 Earnings: What's in the Cards?

Calix, Inc. CALX is scheduled to report second-quarter 2020 results on Jul 21, after the closing bell. In the last reported quarter, the company delivered a positive earnings surprise of 42.9%. Notably, the company has a trailing four-quarter earnings surprise of 43%, on average.

The San Jose, CA-based cloud and software platforms, systems and services provider is expected to have recorded higher total revenues on a year-over-year basis. Despite coronavirus-induced challenges, Calix benefited from customer base expansion along with operational excellence.

Let’s discuss the factors that are likely to get reflected in the upcoming quarterly announcement.

Factors at Play

During the quarter under review, Indianola Municipal Utilities deployed a fiber broadband network with Calix’s Intelligent Access EDGE to deliver essential communication services to telecommuters in central Iowa. Calix also introduced a new Network Capacity Assessment Service, adding to its Professional Services portfolio.

South Central Connect, a wholly-owned subsidiary of the South Central Arkansas Electric Cooperative, enhanced its GPON network with Calix’s Intelligent Access EDGE. Calix unveiled two new EDGE Systems, the GigaSpire BLAST u6.1 and u6.2, second-generation Wi-Fi 6 systems that enable communications service providers (CSPs) to expand their subscriber experience offerings.

The company launched a new partner program that enhanced its ability to equip CSPs with the solutions to meet customer demands. Ringgold Telephone Company selected Calix’s Revenue EDGE, deploying the second generation Wi-Fi 6 EDGE Systems along with EDGE Insights. Quadro Communications Cooperative partnered with Calix Professional Services to streamline residential deployments across its growing fiber network. Such developments are likely to have had a positive impact on the company’s top line.

For the June-end quarter, the Zacks Consensus Estimate for total revenues is pegged at $113 million, indicating growth of 13% from the year-ago quarter’s reported figure. Adjusted earnings per share are pegged at 6 cents, which calls for a surge of 700% from the prior-year quarter’s recorded figure.

What Our Model Says

Our proven model doesn’t conclusively predict an earnings beat for Calix this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Calix’s Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00% as both are pegged at 6 cents.

Calix, Inc Price and EPS Surprise

Zacks Rank: Calix currently sports a Zacks Rank #1.

Stocks to Consider

Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:

Graphic Packaging Holding Company GPK is slated to release second-quarter 2020 results on Jul 21. It has an Earnings ESP of +12.00% and currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Preferred Bank PFBC is scheduled to release second-quarter 2020 results on Jul 21. The company has an Earnings ESP of +13.64% and sports a Zacks Rank #1, at present.

Texas Instruments Incorporated TXN has an Earnings ESP of +6.19% and a Zacks Rank of 2. The company is set to report second-quarter 2020 results on Jul 21.

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