Fabrinet to Report Q3 Earnings: What's in the Cards for the Stock?

Fabrinet FN is slated to release third-quarter fiscal 2025 results on May 5.

For the fiscal third quarter, revenues are expected in the range of $850-$870 million. Non-GAAP earnings per share are anticipated to be between $2.55 and $2.63.

The Zacks Consensus Estimate for fiscal third-quarter revenues is pegged at $858.96 million, suggesting 17.42% growth from the figure reported in the year-ago quarter.

The consensus mark for earnings is pegged at $2.47 per share, down 5% in the past 30 days, suggesting 3.35% growth from the figure reported in the year-ago quarter.

Fabrinet Price and EPS Surprise

Fabrinet price-eps-surprise | Fabrinet Quote

Fabrinet’s earnings beat the Zacks Consensus Estimate in each the trailing four quarters, delivering an average surprise of 5.96%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Let’s see how things have shaped up for the upcoming announcement.

Factors to Note for FN’s Q3 Earnings

FN’s performance in the fiscal third quarter is likely to have benefited from continued strength in telecom and steady growth in automotive revenues.

Telecom revenues are expected to have grown strongly on a sequential basis, driven by increasing momentum in data center interconnect products and early contributions from recent system wins. This follows a robust fiscal second-quarter performance, where telecom revenues rose 24% year over year and 17% sequentially.

Fabrinet expects datacom revenues to decline slightly on a sequential basis, primarily due to customer transitions to next-generation products.

FN expects automotive revenues to continue their sequential growth trend.

Gross margin in the fiscal second quarter was 12.4% compared to 12.7% in the fiscal first quarter, primarily due to first quarter forex tailwinds. Favorable forex on gross margin is expected to have persisted during the quarter.

What Our Model Says

The Zacks model predicts that 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.

Fabrinet has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell) at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

StoneCo STNE has an Earnings ESP of +13.79% and sports a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

StoneCo shares have appreciated 76.4% year to date. STNE is set to report its first-quarter 2025 results on May 8.

Affirm AFRM presently has an Earnings ESP of +63.27% and flaunts a Zacks Rank #1. 

Affirm shares have plunged 17.1% year to date. AFRM is scheduled to report its fourth-quarter fiscal 2025 results on May 8.

Baidu BIDU currently has an Earnings ESP of +8.67% and a Zacks Rank #3.

Baidu shares are up 5.9% year to date. BIDU is slated to report its first-quarter 2025 results on May 21.

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This article originally published on Zacks Investment Research (zacks.com).

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