Acme Packet, Inc. Second Quarter Earnings Sneak Peek

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Acme Packet, Inc. (NASDAQ:APKT) will unveil its latest earnings on Thursday, July 26, 2012. Acme Packet provides session border controllers that enable service providers to deliver secure interactive communications–voice, video, and other real-time multimedia sessions–across Internet Protocol network borders.

Acme Packet, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 2 cents per share, a decline of 90.5% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 11 cents. Between one and three months ago, the average estimate moved down. It also has dropped from 7 cents during the last month. Analysts are projecting profit to rise by 61.5% versus last year to 25 cents.

Past Earnings Performance: For the past three quarters, the company’s quarterly results have come in below analyst’s expectations. Last quarter, the company reported profit of 4 cents per share versus a mean estimate of net income of 7 cents per share.

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A Look Back: In the first quarter, profit fell 82.3% to $2.4 million (3 cents a share) from $13.7 million (19 cents a share) the year earlier, missing analyst expectations. Revenue fell 4.2% to $70.8 million from $74 million.

Stock Price Performance: Between April 25, 2012 and July 20, 2012, the stock price fell $11.61 (-40.8%), from $28.47 to $16.86. The stock price saw one of its best stretches over the last year between April 20, 2012 and April 27, 2012, when shares rose for six straight days, increasing 7.3% (+$1.97) over that span. It saw one of its worst periods between March 20, 2012 and March 28, 2012 when shares fell for seven straight days, dropping 10.6% (-$3.01) over that span.

Wall St. Revenue Expectations: Analysts predict a decline of 16.1% in revenue from the year-earlier quarter to $66.9 million.

Key Stats:

On the top line, the company is looking to get back on the right track after last quarter’s drop snapped a string of revenue increases. Revenue rose 49.5% in the second quarter of the last fiscal year, 24.7% in the third quarter of the last fiscal year and 18.2%in the fourth quarter of the last fiscal year before dropping in the first quarter.

After experiencing income drops the past three quarters, the company is hoping to use this earnings announcement to rebound. Net income fell 24.3% in the third quarter of the last fiscal year, by 39.9% in the fourth quarter of the last fiscal year and again in the first quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 8.39 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 9.65 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 21.8% to $55.2 million while assets rose 5.9% to $462.9 million.

Analyst Ratings: There are mostly holds on the stock with 14 of 18 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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