TeleCommunication Systems Q4 Earnings Preview

Posted January 30, 2012

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TeleCommunication Systems, Inc. develops and applies wireless data communications technology, with emphasis on text messaging, location-based services including enhanced 9-1-1 (E9-1-1) for wireless carriers and Voice over Internet Protocol (VoIP) service providers, and secure satellite-based communication solutions for government customers. Its business is conducted through two operating segments, Commercial and Government. The company will report its fourth quarter earnings on Thursday, February 2, 2012.

Expectations: Analysts are expecting the company to come in with earnings of 8 cents per share, 27.3% less than a year ago, when it reported earnings of 11 cents per share. The consensus estimate is up from three months ago when it was 7 cents, but hasn't changed over the past month. For the fiscal year, analysts are projecting earnings of 36 cents per share. The company is projected to top last year's reported revenue of $102.3 million by 18.5% to come in $121.2 million for the quarter. Revenue for the fiscal year is expected to be $425 million.

Performance: While the company has been profitable for the last eight quarters, income has fallen year-over-year by an average of 54.8% over the past four quarters. The hardest-hit quarter for the company was the fourth quarter of the last fiscal year, in which profit dove 69.7%. Revenue has been growing for the past two consecutive quarters. It rose 9.4% to $112.6 million in third quarter. In the previous quarter, the figure rose 8.7%y. Since November 1, 2011, the stock price has dipped 25.9% to $2.34 from $3.16. The price is within 24 cents of its 52-week low of $2.10, which was set on December 15, 2011. The price of TeleCommunication Systems' stock recently went on a hot streak as it rose 10 cents per share between December 13, 2011 and January 5, 2012. It finished at $2.38.

Ratings: Analysts generally think investors rate TeleCommunication Systems a hold, with four of seven analysts rating it hold. Analysts' opinions about the stock have worsened recently, as buy ratings have dropped slightly over the last three months.

Earnings estimates provided by Zacks.

TeleCommunication Systems, Inc.

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