Upcoming AWS Coverage on Acacia Communications Post-Earnings Results

LONDON, UK / ACCESSWIRE / February 14, 2017 / Active Wall St. announces its post-earnings coverage on Motorola Solutions, Inc. (NYSE: MSI). The Company released its financial results for Q4 and full year fiscal 2016 on February 02 2017. The communications equipment maker surpassed earnings and revenue expectations. In February 2016, Motorola completed the acquisition of Airwave, the largest private operator of a public safety network in the world. Register with us now for your free membership at: http://www.activewallst.com/register/.

One of Motorola Solutions' competitors within the Communication Equipment space, Acacia Communications, Inc. (NASDAQ: ACIA), announced on February 03, 2017, that it will release its Q4 and full year 2016 results on Thursday, February 23, 2017, after the close of the US financial markets. The Company will host a conference call and live audio webcast at 5 p.m. ET the same day. AWS will be initiating a research report on Acacia Communications in the coming days.

Today, AWS is promoting its earnings coverage on MSI; touching on ACIA. Get our free coverage by signing up to http://www.activewallst.com/register/.

Earnings Reviewed

For the quarter ended December 31, 2016, Motorola posted revenue of $1.88 billion, up 12%, including Airwave's revenue of $124 million compared to Q4 2015 revenue of $1.68 billion. Motorola's revenue surpassed analysts' consensus of $1.84 billion. For FY16, the Company's revenue grew 6% to $6.04 billion including $462 million of Airwave's revenue. Revenue, excluding Airwave, declined 2% on weakness in Latin America and parts of Europe in H1 2016, while both North America and Asia-PAC grew for FY16.

For Q4 2016, Motorola's GAAP operating margin was 21.4% of sales, compared to 23.1% of sales in the year-ago same quarter. Non-GAAP operating margin was 28.7% of sales in the reported quarter compared to 27.2% in the corresponding year-ago comparable quarter. For FY16, Motorola's GAAP operating margin was 17.7% of sales compared to 17.5% for the prior year. Non-GAAP operating margin was 23.6% of sales for FY16 compared with 20.5 % for the prior year.

For Q4 2016, Motorola' GAAP operating earnings were $403 million. Non-GAAP operating earnings were $541 million, or 29% of sales, representing an improvement of 150 basis points from the year ago same quarter. GAAP earnings per share from continuing operations were $1.43 compared to $1.56 in the year-ago quarter. Non-GAAP EPS was $2.03 a share, up $1.58 up from $1.58 in Q4 2015, a 28% y-o-y increase. Results topped Wall Street's expectations for earnings of $1.86 per share. For FY16, operating earnings were $1.4 billion, up $261 million, or 22% compared to FY15. Earnings per share grew 48% to $4.92.

Segment Results

For Q4 2016, Motorola's product sales were $1.23 billion, up 9% from the prior year driven by growth in every region. Q4 2016 products operating income was $407 million, or 33% of sales, up 300 basis points from last year. Products backlog ended Q4 2016 at $1.5 billion, up approximately $300 million from last year, primarily on continued strength in North America.

The Company's services revenue was $657 million, during Q4 2016 up 18% on a y-o-y basis. Services' operating income was $134 million, or 20% of revenue. Operating margins were down year-on-year due to higher integration costs associated with the completion of the Norway implementation phase as well as higher incentive costs for the 2016 backlog performance. Services backlog ended at $6.9 billion, up $1.6 billion from last year. Of the $1.6 billion increase, Airwave was $1.25 billion, and organic managed and support services were up $300 million driven primarily by North America.

Fourth-quarter strategic wins

During Q4 2016, Motorola won a $140 million P25 system deployment contract for the Washington, D.C. Metro Area Transit Authority. The Company also secured $60 million P25 system replacement and multiyear services for San Francisco, a $40 million P25 system and devices upgrade unifying eight cities in Argentina and a $17 million Smart Public Safety Solutions sale of computer-aided dispatch equipment, software, and multiyear services to Indianapolis.

Balance Sheet & Cash Flow

For Q4 2016, Motorola generated $513 million in operating cash from continuing operations, up $98 million from the year-ago same quarter primarily driven by earnings from higher revenue. Free cash flow was up $82 million to $453 million. For FY16, the Company generated $1.2 billion in operating cash from continuing operations, reflecting an increase of $144 million from the prior year. Free cash flow was $894 million for FY16, up $48 million from the prior year.

The Company ended the quarter with cash and cash equivalents of $1.0 billion and a net debt position of approximately $3.4 billion. Motorola repaid the $675 million term loan associated with the Airwave acquisition, repurchased $114 million of common stock, paid $68 million in dividends, and invested $246 million in acquisitions during the reported quarter. During FY16, Motorola invested $1.3 billion in acquisitions, repurchased approximately $842 million of its common stock and paid $280 million in dividends.

Outlook

For Q1 2017, Motorola expects revenue growth of 3% to 5% on a y-o-y basis, including approximately $115 million from Airwave versus $61 million in Q1 2016. The Company expects non-GAAP earnings per share from continuing operations in the range of $0.52 to $0.57 per share for the upcoming quarter. For FY17, Motorola is projecting revenue to grow 1% to 2%. The Company expects non-GAAP earnings per share from continuing operations in the range of $5.05 to $5.20 per share for FY17.

Stock Performance

On Monday, February 13, 2017, the stock closed the trading session at $78.48, slightly up 0.14% from its previous closing price of $78.37. A total volume of 1.41 million shares have exchanged hands, which was higher than the 3-month average volume of 1.24 million shares. Motorola Solutions' stock price advanced 6.45% in the past six months, and 29.97% in the previous twelve months. The stock is trading at a PE ratio of 24.03 and has a dividend yield of 2.40%.

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SOURCE: Active Wall Street