Factors Likely To Influence InTest's (INTT) Earnings In Q4

inTest Corporation (NYSE:INTT) is set to report fourth-quarter 2018 results on Mar 7.

We note that the company has outpaced the Zacks Consensus Estimate in the trailing four quarters, recording average positive surprise of 53.55%.

In the last reported quarter, inTest delivered non-GAAP earnings of 27 cents per share, recording a positive surprise of 22.73%. The figure surged 35% year over year but decreased 20.6% sequentially.

Revenues advanced 16.1% year over year but declined 4.3% sequentially to $20.2 million. The top line was driven by robust performance of the company’s thermal segment. Further, strengthening customer base contributed well.

For the fourth quarter, the company expects non-GAAP earnings to lie between 18 cents and 22 cents per share. The Zacks Consensus Estimate is pegged at 18 cents per share.

Further, the company’s net revenues are projected to lie within the range of $17.5 million to $18.5 million in fourth quarter.

Let’s see how things are shaping up prior to this announcement.

inTest Corporation Price and EPS Surprise

inTest Corporation Price and EPS Surprise | inTest Corporation Quote

Factors to Consider

The company’s growing momentum among end-users and OEMs remains a major positive as it is aiding in expansion of the customer base. Moreover, its strong focus toward growth market areas will continue to aid end-market performance in the to-be-reported quarter.

Further, the company’s strengthening thermal segment continues to expand presence in the electronic test market. Further, well-performing inTest Thermal Solutions (iTS) and positive contributions from Ambrell acquisition on account of its solid momentum across OEM partners are acting as tailwinds.

Apart from the above-mentioned factors, rising demand from semi, aerospace and automotive customers is likely to drive the bookings within this segment, which in turn will propel the company’s top line in the to-be-reported quarter.

Additionally, increasing demand for Internet of Things (IoT), automotive sensors, mobility technologies is driving the company’s performance in the semiconductor industry. However, EMS product lines that cater to needs of automated test equipment market are anticipated to impact inTest’s position in this particular industry.

This comes on the heels of extended lead times by prober manufacturers and others which continues to impact EMS order timing negatively.

Nevertheless, inTest’s expanding footprint in the industrial process markets are expected to benefit results in the to-be-reported quarter.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

inTest currently has a Zacks Rank #3 and an Earnings ESP of 0.00%, making the surprise prediction difficult.

Stocks That Warrant a Look

Here are few stocks worth considering as our model shows that it has the right combination of elements to deliver an earnings beat in the upcoming releases.

Momo Inc. (NASDAQ:MOMO) has an Earnings ESP of +1.55% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Akamai Technologies, Inc. (NASDAQ:AKAM) has an Earnings ESP of +0.61% and a Zacks Rank #2.

Mistras Group Inc (NYSE:MG) has an Earnings ESP of +4.76% and Zacks Rank #3.

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