Stock on the Move: Polycom Inc (PLCM)

Polycom, Inc. (NASDAQ:PLCM) reported earnings for the three months ended Mar2016 on April 20, 2016. The company earned $0.19 per share on revenue of $290.08M. Analysts had been modeling earning per share of $0.19 with $301.4M in revenue.

Polycom, Inc. (NASDAQ:PLCM) reported first quarter 2016 revenues of $290 million, non-GAAP net income of $26 million and non-GAAP earnings per diluted share of 0.19 cents. GAAP net income for the first quarter of 2016 was $3 million, or 0.02 cents per diluted share. Polycom’s quarterly reconciliation of GAAP to non-GAAP performance is provided in the tables at the end of this press release.

Revenues in the first quarter were lower on both a sequential and year-over-year basis. In spite of lower revenues, Polycom again delivered non-GAAP gross margin, operating income and diluted earnings per share in line with our guidance.

The Americas grew sequentially, including both sequential and year-over-year growth in the United States. Results in EMEA were affected by lower revenues in Russia and Middle East Africa. Year-over-year results for EMEA were also impacted by foreign exchange. Results in Asia Pacific were affected by macro-economic factors and a recent Polycom leadership change in China, as previously disclosed. Polycom will continue to monitor macro-economic factors in key regions and looks for improved revenue levels in China going forward.

In terms of product category results, both UC Group and UC Platform revenues showed year-over-year declines. UC Group was affected by China, Russia and Middle East Africa, as well as mix within the product category. A significant portion of UC Platform revenue typically comes from China and Russia, which saw lower overall revenue this quarter.

Polycom, Inc. earnings per share showed an increasing trend of 72.2% for the current fiscal year. The company’s expected EPS growth rate for next fiscal year is 91%.Analysts project EPS growth over the next 5 years at 15%. It has EPS annual growth over the past 5 fiscal years of 76.7% when sales grew 2.5. It reported -12.3% sales drop, and -84% EPS decline in the last quarter.

The stock is trading at $12, up 36.52% from 52-week low of $8.79. The stock trades down -14.83% from its peak of $14.09 and 9.08% above the consensus price target of $13.09. Its volume clocked up at 1.22 million shares which is lower than the average volume of 1.63 million shares. Its market capitalization currently stands at $1.62B.