NetComm
The market responded positively when the mobile broadband company kept its earnings forecast steady despite an expected drop in sales.
Shares in the 3G mobile broadband equipment maker have bounced nearly 14 per cent since hitting a six-month low of 18¢ on Monday after management gave a revised earnings guidance for the year to June 30, 2011. While management lowered the sales forecast to between $71 million and $87 million from guidance of $100 million to $116 million in August, it kept its earnings before interest and tax forecast of $8 million to $13 million – more than double what it made last year. The result was driven by a change in product mix to lower-turnover but higher-margin equipment. This reduction in sales intensity will not hurt earnings, which means that NetComm is operating more efficiently.
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