Tech Stocks to Post Earnings This Week: MCHP, TDC, PKI, CTSH

With the Q1 earnings cycle in full swing, a number of tech companies are slated to report their quarterly numbers over the next few days. So far, the earnings scenario for the overall sector has remained pretty unimpressive.

First-quarter results for the technology sector were marred by weaker-than-expected numbers from behemoths like Apple AAPL, Microsoft MSFT and Alphabet GOOGL. Notably, as of Apr 29, total earnings of all the companies, representing 85.3% of the tech sector’s total market capitalization in the S&P 500 index, were down 5.9% on 0.7% higher revenues. (Read more: Why Are More Companies Beating Q1 Estimates?)

Furthermore, the earnings scenario for the overall tech sector remains gloomy, with the Zacks Earnings Trend predicting a 6% year-over-year decline in the quarter, despite a modest sales growth projection of 2.3%.

Among the companies slated to report this week, let’s see what awaits these four major tech stocks, all of which are scheduled to release their quarterly numbers this week.

Microchip Technology Inc. MCHP, which develops and manufactures specialized semiconductor products, is scheduled to report its fourth-quarter fiscal 2016 results on May 4.For the to-be-reported quarter, this Zacks Rank #2 (Buy) company has an Earnings ESP of 3.33%. The Zacks Consensus Estimate is pegged at 60 cents.

Last quarter, the company posted a positive earnings surprise of 10.91%. In fact, Microchip has a healthy track record with respect to earnings, having delivered positive surprises in each of the last four quarters with an average beat of 5.20%.

Microchip is one of the fastest growing providers of 16-bit and 32-bit microcontrollers in the world. In fact, the company’s microcontroller business has historically outperformed the industry and is expected to record a solid performance in the upcoming quarter as well. Furthermore, Microchip is increasingly expanding its touch business beyond handsets and tablets in areas such as automotive industrial applications, which should boost its to-be-reported quarterly results. (Read more: Will Microchip's Earnings Momentum Continue in Q4?)

Teradata Corporation TDC, the world's largest company focused on raising intelligence through data warehousing and enterprise analytics, is slated to post its first-quarter 2016 results on May 5. For the quarter, the company has an Earnings ESP of 0.00% and it carries a Zacks Rank #3 (Hold). The Zacks Consensus Estimate stands at 31 cents.

Last quarter, the company posted a negative earnings surprise of 3.08%. Notably, Teradata has missed the Zacks Consensus Estimate in all the four trailing quarters, with an average negative surprise of 13.87%.

Since the past few quarters, Teradata’s business has been impacted by unfavorable customer purchase patterns. The recent realignment of its sales force in the U.S. could make things even more difficult for the company. Moreover, in the first quarter, the company is expected to exit from most of its Marketing Applications business, resulting in an after-tax loss of $7 million. (Read more: Teradata to Report Q1 Earnings: Will It Miss Again?)

PerkinElmer, Inc. PKI, a global technology company that provides products and systems to the telecom, medical, pharmaceutical, chemical, semiconductor and photographic markets, will report its first-quarter 2016 results on May 5.For the to-be-reported quarter, this Zacks Rank #2 company has an Earnings ESP of 0.00%. The Zacks Consensus Estimate is pegged at 51 cents.

Last quarter, PerkinElmer posted a negative earnings surprise of 1.15%. Notably, the company has surpassed the Zacks Consensus Estimate thrice in the trailing four quarters, with an average positive surprise of 4.81%.

PerkinElmer expects the Medical imaging segment to face headwinds in the first half (down in the high single/low double digits) of 2016. Moreover, strengthening of the U.S. dollar, a sluggish European macro environment and challenges in Japan are expected to impede top-line growth in the near term. Nonetheless, we believe PerkinElmer has maintained strong execution of its business across several product lines, aided by rebounding markets and effective cost-containment efforts. New product launches are expected to be key catalysts, going forward. (Read more: Can PerkinElmer Pull a Surprise in Q1 Earnings?)

Cognizant Technology Solutions Corporation CTSH, a worldwide provider of IT, consulting and business process services, is scheduled to post its first-quarter 2016 results on May 6.For the to-be-reported quarter, this Zacks Rank #3 company has an Earnings ESP of 0.00%. The Zacks Consensus Estimate is pegged at 70 cents.

Last quarter, the company posted a positive earnings surprise of 4.23%. Notably, Cognizant has surpassed the Zacks Consensus Estimate thrice in the preceding four quarters, with an average positive surprise of 3.79%.

Cognizant has been benefiting from its healthy exposure to fast-growing verticals like Financial Services and Healthcare. We expect the company to benefit from strong demand for high quality, lower cost technology services, especially in the outsourcing market. Rising demand for offshore services beyond traditional IT outsourcing namely, BPO (Business Process Outsourcing), KPO (Knowledge Process Outsourcing) and IT infrastructure services, also bodes well for the company. However, it can be impacted by a slowdown in regions like North America or unfavorable changes in industries like financial services. (Read more: Cognizant to Post Q1 Earnings: What's in the Cards?)

Stay tuned! Check later on our full write-up on earnings releases of these stocks.

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