Here's What Hedge Funds And The Buy Side Expect Linear Tech. To Report Tuesday

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 |  About: Linear Technology Corporation (LLTC)
by: Leigh Drogen

Linear Technology (NASDAQ:LLTC) is set to release FQ2’2014 earnings after the market closes on Tuesday, January 14th. Linear Technology is an American multinational corporation that designs and manufactures analog integrated circuits for use in telecommunications, cell phones, computers, and more. Over the past 2 years Linear Tech has beaten Wall Street’s quarterly profit expectations 7 of 8 times and the stock is up nearly 50% over that period. image

The information below is derived from data submitted to the Estimize platform by a set of Buy Side and Independent analyst contributors.image
The current Wall Street consensus expectation is for LLTC to report 44c EPS and $335.64M revenue while the current Estimize consensus from Buy Side and Independent contributing analysts is 44c EPS and $336.6M revenue.
Over the past 6 quarters the Estimize profit consensus has been more accurate than Wall Street 5 times. By tapping into a wider range of contributors including hedge-fund analysts, asset managers, independent research shops, students, and non professional investors, Estimize has created a data set that is up to 69.5% more accurate than Wall Street, but more importantly it does a better job of representing the market’s actual expectations.
The magnitude of the difference between the Wall Street and Estimize consensus numbers often identifies opportunities to take advantage of expectations that may not have been priced into the market. In this case we are seeing very little difference between the consensuses.image
The distribution of estimates published by analysts on Estimize range from 41c to 49c EPS and $335.00M to $338.00M in revenues. This quarter we’re seeing a larger distribution of estimates on EPS but a more narrow one for revenue. The size of the distribution of estimates relative to previous quarters often signals whether or not the market is confident that it has priced in the expected earnings already. A wider distribution signaling the potential for greater volatility post earnings, a smaller vice versa.image
Over the past 4 months we have Wall Street decrease its revenue consensus from 46c to 44c while Estimize has lowered its EPS consensus from 45c to 44c. This quarter the Wall Street revenue consensus has fallen from $343.49 to $335.64 while the Estimize consensus has edged up from $336.17 to $336.63.image
The analyst with the highest estimate confidence rating this quarter is BradHewitt91, who projects 47c EPS and $336.5M in revenue. Estimate confidence ratings are calculated through algorithms developed by our deep quantitative research which looks at correlations between analyst track records and tendencies as they relate to future accuracy. In this case our highest rated analyst is expecting LLTC to beat the Street on both the top and bottom line.image
Throughout the past 2 years, LLTC has a great record of beating the Wall Street profit consensus. However, this quarter contributing analysts on the Estimize platform are expecting Linear Technology Corp. to report in line with the Street’s profit expectations and exceed slightly on revenue.
Disclosure: No positions