In this article I will recap the historical results of the company, its latest EPS estimates vs. surprises, the latest news from BRCD and the news from its closest competitors.
Recent EPS Actuals vs. Estimates
In the last four quarters the company has met or beaten analysts' estimates. In the last quarter it reported $0.15 EPS, beating analyst estimates of $0.12.
The consensus EPS estimate is $0.12 based on 26 analysts' estimates, up from $0.09 a year ago. Revenue estimates are $536.93M, up from $502.85M a year ago. The median target price by analysts for the stock is $6.00.
Average recommendation: Hold
- On August 7, 2012, Brocade Communications Systems, Inc. announced that a San Jose federal court jury returned its verdict this afternoon in the case of Brocade v. A10 Networks, and found A10 responsible for broad-based intellectual property infringement and unfair competition, awarding approximately $112 million to Brocade.
- On May 23, 2012, Brocade announced that it has partnered with EMC to simplify and automate the management of joint EMC and Brocade storage area networking (SAN) environments. This integration provides organizations with a more holistic view of their storage networking resources to improve alert monitoring and enhance correlation in order to expedite issue resolution within highly virtualized and cloud environments.
- On May 22, 2012, Brocade outlined its strategy for software-defined networking (SDN), a technology gaining broad support across network operators and enterprises on a global basis. In support of its SDN strategy, Brocade also announced that it has integrated hardware based OpenFlow support in the Brocade® MLX® Series of routers and related Brocade NetIron® platforms, enabling customers to deploy SDN at wire-speed 100 Gigabit Ethernet (GbE) performance.
- On May 17, 2012, Brocade Communications Systems, Inc. announced that for third quarter of 2012, it expects revenue to be in the range of $525-$545 million and non-GAAP earnings per share (EPS) in the range of $0.11-$0.13. According to I/B/E/S Estimates, analysts are expecting the Company to report revenue of $541 million and EPS of $0.12 for third quarter of 2012.
- On February 28, 2012, Brocade Communications Systems, Inc. announced that it expanded its investment in the vibrant Asia Pacific region with the opening of a regional briefing center (RBC) located in Singapore.
- On February 21, 2012, Brocade Communications Systems, Inc. announced that for second quarter of 2012, it expects revenue to be in the range of $530-$545 million and non-GAAP earnings per share in the range of $0.11-$0.12. According to I/B/E/S Estimates, analysts are expecting the Company to report revenue of $537 million and EPS of $0.12 for second quarter of 2012.
Aruba Networks (ARUN), Cisco Systems (CSCO), F5 Networks (FFIV), and Juniper Networks (JNPR) are peers for comparison for Brocade and the table below provides the key metrics for these companies and the industry.
The chart below compares the stock price changes as a percentage for the selected companies and S&P 500 index for the last one year period.
Competitors' Latest Developments
- On July 31, 2012, Cisco Systems Inc announced that Brisbane Airport Corporation (BAC), the operator and developer of Brisbane Airport, which facilitates the movement of more than 21 million passengers and tons of freight each year, has selected virtualization technology from Cisco, EMC and VMware to help achieve information and communications technology (ICT) strategy to improve business agility and airport operational effectiveness.
- On July 31, 2012, Cisco Systems Inc announced that it has completed the acquisition of NDS Group Ltd., provider of video software and content security solutions that enable service providers and media companies.
- On July 24, 2012, Reuters reported that Cisco Systems Inc won unconditional EU regulatory approval on Tuesday for its $5 billion takeover of TV software developer NDS. NDS, which is 51% owned by private equity fund Permira and 49% by News Corp, makes software that allows cable and satellite TV companies to deliver encrypted content through televisions and other devices.
- On July 24, 2012, Juniper Networks, Inc. announced that for the third quarter of 2012, it expects revenue to be in the range of $1,040-$1,075 million and non-GAAP net income per share to be in the of range between $0.15 and $0.18 on a diluted basis.
- On July 18, 2012, F5 Networks, Inc. announced that for the fourth quarter of 2012, it expects revenue to be in the range of $360-$370 million, net income to be in the range of $72.1-$74.5 million, Non-GAAP net income excluding stock-based compensation expense and amortization of purchased intangible assets to be in the range of $92.7-$95.1 million, GAAP earnings per diluted share to be in the range of $0.90-$0.93 and Non GAAP earnings per diluted share to be in the range of $1.16-$1.19. According to I/B/E/S Estimates, analysts are expecting the Company to report revenue of $377 million, net income of $99 million and EPS of $1.24 for the fourth quarter of 2012.
- On July 11, 2012, Juniper Networks, Inc. announced that Telefonica Digital has selected Juniper Networks Junos Pulse Mobile Security Suite to create a branded mobile security service for its consumer customer base across Europe.
- On July 10, 2012, Juniper Networks, Inc. announced that NTT Communications has integrated Juniper Networks security and remote access technologies into Mobile Connect, a new Bring Your Own Device (BYOD) security service launched to address corporate customers' demand for enhanced mobile network access.
- On June 15, 2012, Cisco Systems Inc announced that it has declared a quarterly dividend of $0.08 per common share to be paid on July 25, 2012, to all shareholders of record as of the close of business on July 5, 2012.
- On June 13, 2012, Aruba Networks, Inc. announced that its Board of Directors has authorized a share repurchase program for up to $100 million of its outstanding common stock.
- On June 11, 2012, Juniper Networks, Inc. announced a new stock repurchase program which enables the Company to purchase up to $1 billion of the Company's common stock. This new authorization is in addition to the $1 billion stock repurchase program approved in 2010.
- On June 5, 2012, Aruba Networks, Inc. announced that Maxim Integrated Products, Inc., has extended its network and deployed a wireless access network utilizing Aruba Instant virtualized controllers to deliver wireless coverage to its 24 sales offices, 40 technology design centers, and 11 wafer fabrication/testing facilities.
- On June 4, 2012, Reuters reported that TiVo Inc countersued Cisco Systems, Inc. in a court over alleged infringement of four patents relating to digital video recorder (DVR) technology, days after Cisco filed a lawsuit against TiVo to void those same patents.
- On May 30, 2012, Streakwave Wireless announced a distribution agreement with Aruba Networks, Inc. for enterprise Wi-Fi, network management, and access control products.
- On May 17, 2012, Aruba Networks, Inc. announced that for fourth quarter of 2012, it expects revenue to be in the range of $136-$138 million and non-GAAP earnings per share to be approximately $0.16-$0.17. According to I/B/E/S Estimates, analysts are expecting the Company to report revenue of $138 million and EPS of $0.17 for fourth quarter of 2012.
The stock has a market capitalization of $2.42B and is currently trading at $5.38 with a 52 week range of $3.31 - $6.17. The stock's year-to-date performance has been 3.66%. It is currently trading above 20, 50 and 200 SMA.
Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.