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InvenSense schedules 3Q16 report ?5
InvenSense has scheduled the earnings report on its fiscal third quarter for after market close on January 27th. It will hold a conference call to discuss the results at about 4:30PM EST. On average, analysts expect the company to earn 18 cents per share on revenue of $118M; average expectations for current quarter revenue come in at $104M.
As per recent notes, I see earnings and guidance as the proving point for new management and thus a likely inflection point for the stock. Recent ExOne notes should make it clear that inflection points aren't always positive, but I do think the hybrid valuation, which is now below 10, makes for more potential upside than down in this particular case.
Nonetheless, feedback from multiple sources has been that I should try to give a clearer picture of the risks. If you want safety, INVN is not for you. You might instead consider BGCP or INTC, whose report I will also cover this Thursday evening. I've mentioned execution risk, which means that InvenSense has big plans which could easily fall flat. To that end, I will be taking a hard looking at CapEx. If endeavors like Coursa are relatively cheap, then it's hard to see the stock as anything other than cheap right now also. Consequently, while the market might react badly to an earnings or guidance miss, I would have to think that any further downside will eventually be amended. However, if management is spending away the company's hard earned cash flow, then risk increases linearly with expense.