Is Emulex in Major Turnaround?

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Emulex Corp. (NYSE: ELX) announced the preliminary financial results for the second quarter of its fiscal year 2015. Across the board, the results were higher than the previous guidance given by the company.

On a preliminary basis, the company currently anticipates revenue will be in the range of $110 million to $111 million, with earnings per share in the range of $0.23 to $0.24. In the second quarter of the previous year it posted $0.21 in earnings per share and $123 million in revenue.

Thomson Reuters has recent consensus analyst estimates of $0.16 in earnings per share and $105.73 million in revenue. The previous guidance given by Emulex was earnings per share in the range of $0.14 to $0.18 and revenue in the range of $102 million to $108 million.

Jeff Benck, President and CEO of Emulex, said:

Emulex finished calendar year 2014 in a much stronger position led by a resilient Fibre Channel sector and benefiting from solid execution and customers’ embrace of our current product cycles. We look forward to building on this foundation as the broad slate of OEM qualifications of our 10Gb Ethernet products designed for next generation x86 servers ramp in the market over the next year.

Emulex plans to host its conference call on January 29 to discuss its second-quarter results.

On the day of this preliminary earnings announcement, Summit Research reiterated a Hold rating for the company with a price target of $6. This is equal to the highest price target that any analyst has given Emulex.

Shares of Emulex were up 19% at $6.93 in the last hour of trading on Tuesday. The company has moved over 6.7 million shares on the day, over seven times its average volume.

The stock has a consensus analyst price target of $5.83 and a 52-week trading range of $4.45 to $7.74.

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