ADC Beats on Earnings and Sales, Guides Higher

After-hours Monday, telecom equipment maker ADC announced Q1 2007 net earnings of $3.6 million on revenue of $297 million, up from a $1.8 million loss in Q1 2006 on revenue of $272 million, and beating analyst estimates of $263 million. EPS were $0.03 vs. a $0.02/share loss last year. Earnings from continuing operations were $0.08/share, beating analyst estimates of $0.06. ADC forecast full-year 2007 EPS of $0.86 on revenue of $1.26-1.29 billion; analysts were calling for per-share earnings of $0.85. CEO Bob Switz said, "We are pleased with this performance in the face of several customer timing variables, including merger integration in the U.S. and regulatory reviews in other countries." In after-hours trading yesterday, shares were up 5.5% ($0.84) to $16.11.

Sources: ADCT Earnings Conference Call Transcript, MarketWatch, TheStreet.com
Commentary: Earnings Preview: Four Companies That Could Surprise This Week • ADC Telecom: JP Morgan Sees Stronger Outlook Than Expected - http://telecom.seekingalpha.com/article/25379 • ADC Telecommunications Seeks China Entry via Acquisition
Stocks/ETFs to watch: ADC Telecommunications Inc. (ADCT). Competitors: ADTRAN Inc. (ADTN), Andrew Corp. (ANDW), Tyco International Ltd. (TYC). ETFs: iShares Dow Jones U.S. Telecom Sector Index ETF (IYZ), Telecom HOLDRS ETF (TTH), Vanguard Telecom Services ETF (VOX)

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