Semiconductor Stocks' Earnings Due On Jul 31: IDTI, AMKR

The second-quarter reporting cycle is in full swing. As of Jul 26, 2017, 171 S&P 500 members, accounting for 44.1% of the index’s total market capitalization, reported results, according to Earnings Preview.

Total earnings for these 171 index members were up 8.8% from the year-ago quarter on a 3.4% improvement in revenues. The beat ratio for earnings and revenues were 78.9% and 70.8%, respectively.

The earnings momentum is expected to continue through the season. Per the report, total earnings for S&P 500 companies in the second quarter are expected to grow 8.7% year over year on 4.7% higher revenues. This follows 13.3% earnings growth in the first quarter on 7% increase in revenues, the highest in almost two years.

A few semiconductor companies are slated toreport their earnings on Jul 31. The industry serves as a driver, enabler and indicator of technological progress. So, let’s take a sneak peek at how Integrated Device Technology, Inc. (NASDAQ:IDTI) and Amkor Technology, Inc. (NASDAQ:AMKR) are placed ahead of their releases.

Integrated Device is unlikely to beat fiscal first-quarter 2018 expectations as it has an unfavorable combination of a Zacks Rank #3 (Hold) and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

This is because, as per our proven model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 to beat earnings. (You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.)

We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into an earnings announcement, especially when the company is witnessing negative estimate revisions.

Notably, Integrated Device delivered a positive earnings surprise of 7.41% in the last quarter. Also, the company outperformed the Zacks Consensus Estimate thrice in the last four quarters, with an average positive surprise of 6.55%.

Integrated Device products continue to gain traction in the computing, communications and automotive markets. However, increasing competition is a significant headwind that will weigh on share price in 2017.

Integrated Device’s shares have returned only 10.0% year to date, underperforming the industry’s gain of 2.4%.

Similarly, Amkor Technology Inc. looks unlikely to beat second-quarter fiscal 2017 estimates as it has an unfavorable combination of a Zacks Rank #3 and an Earnings ESP of 0.00%.

Notably, Amkor Technology’s surprise history has been decent. The company beat estimates in three of the trailing four quarters and missed once. It delivered an average positive surprise of 43.06% during that time frame.Read more: What's in Store for Amkor Technology in Q2 Earnings?)

Amkor Technology’s shares have returned only 2.5% year to date, underperforming the industry’s gain of 32.4%.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaries,"" but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>