Shares of Arris Group rise on strong 2Q results

NEW YORK (AP) -- Shares of Arris Group Inc. rose Thursday after the internet equipment provider posted better-than-expected second-quarter results, boosted by contributions from its acquisition of Motorola Home.

THE SPARK: Arris said late Wednesday that it posted a loss of $50.3 million, or 37 cents per share. The compared with a year-ago profit of $15 million, or 13 cents per share, in the same quarter of 2012.

Excluding one-time items, the company earned an adjusted 46 cents per share for the recent quarter, well ahead of average analysts' estimates of 25 cents per share, according to FactSet.

Revenue nearly tripled to $1 billion. Analysts expected $975.6 million.

For the current quarter, Arris said it expects to post an adjusted profit of 32 cents to 37 cents per share on $1.05 billion to $1.08 billion in revenue. Analysts expect a profit of 28 cents per share on $1.11 billion in revenue.

THE BIG PICTURE: Earlier this year, Suwanee, Ga.-based Arris bought Motorola Mobility's TV set-top business from Google Inc. for about $2.2 billion in cash. The deal was designed to catapult Arris from being a relatively minor provider of high-speed Internet equipment into a much larger player in the delivery of video.

Since the deal closed in April, Arris shares have fallen about 7 percent.

THE ANALYSIS: Jefferies analyst James Kisner backed his "Hold" rating for the stock, saying that while the third-quarter guidance was mixed, he's impressed overall by Arris' earnings power. But he said he'll hold off on buying the shares until he's more confident about the growth and profitability prospects for the company's set-top box business.

THE SHARES: Up 63 cents, or 4 percent, to $16.25 in morning trading, after peaking at $16.85 earlier in the day. Over the past 52 weeks, the company's shares have traded between $12.40 and $17.98.

Source: http://news.yahoo.com/shares-arris-group-rise-strong-153323963.html

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