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Alpha and Omega's (AOSL) Q3 Earnings: What's in the Store?

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Alpha and Omega Semiconductor Limited AOSL is scheduled to report third-quarter fiscal 2021 results on May 5.

For the thirdquarter, the company expects revenues in the range of $154-$160 million. The Zacks Consensus Estimate for the same is pegged at $157million, indicating an increase of 46.9% from the prior-year quarter’s reported number.

Further, the Zacks Consensus Estimate for earnings isat 55 cents per share that suggests a surge from 11 cents per share reported in the year-ago quarter.

The company’s bottom line topped the Zacks Consensus Estimate in all the trailing four quarters. It has an earnings surprise of 66.65%, on average.

Alpha and Omega Semiconductor Limited Price and EPS Surprise

Alpha and Omega Semiconductor Limited Price and EPS Surprise
Alpha and Omega Semiconductor Limited Price and EPS Surprise

Alpha and Omega Semiconductor Limited price-eps-surprise | Alpha and Omega Semiconductor Limited Quote

Factors at Play

Alpha and Omega’s portfolio strength and robust marketing initiatives are expected to get reflected in its fiscal third-quarter results.

Further, its expanding manufacturing capacity might have remained a major positive. Ramping up capacity at the company’s JV fab in Chongqing is expected to have helped in gaining traction among large-scale customers in the quarter under review.

Additionally, the coronavirus outbreak-induced growing sales of gaming, TVs and home appliances are expected to have driven the company’s performance in the consumer end-market in the fiscal second quarter.

Furthermore, growing shipments of Alpha and Omega’s products required in computing and gaming applications are expected to have contributed well to its performance in the quarter under review.

Also, strengthening momentum across new gaming systemsand PC graphics card platforms is anticipated to have aided the company’s multi-sockets design wins in the fiscal second quarter.

Moreover, increasing uptake of gaming applications as well as well-performing DrMOS and digital power solutions is expected to have driven growth in the company’s graphics card business.

Apart from this, the company is likely to have gained from strong battery protection business in the soon-to-be-reported quarter

However, sluggishness in the TV business and weakening home appliances business due to supply chain constraints are expected to have been major headwinds for the company in the fiscal third quarter.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Alpha and Omega this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Alpha and Omega has an Earnings ESP of 0.00% and a Zacks Rank #3.

Other Stocks to Consider

Here are some other stocks worth considering as our model shows that these too have the right combination of elements to beat on earnings this season.

Waters Corporation (WAT) currently has an Earnings ESP of +2.94% and is Zacks #2 Ranked. You can see the complete list of today’s Zacks #1 Rank stocks here.

PayPal Holdings, Inc. PYPL has an Earnings ESP of +1.67% and a Zacks Rank of 3 at present.

Square, Inc. (SQ) presently has an Earnings ESP of +16.14% and a Zacks Rank #3.

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Alpha and Omega Semiconductor Limited (AOSL) : Free Stock Analysis Report

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Square, Inc. (SQ) : Free Stock Analysis Report

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