NEW YORK (TheStreet) -- Micro-cap Zhone Technologies (ZHNE) is suffering from double-digit losses on Wednesday after full-year earnings failed to exceed expectations. In extended trading, shares plummeted 15.6% to $5.24.
The manufacturer of smartphone networking equipment said net income for its fourth quarter topped 4 cents a share, a penny lower than earnings in the preceding quarter. Revenue of $32.3 million was 14.1% higher than the year-ago quarter.
For fiscal 2013, the company recorded net income of 14 cents a share on $122.25 million in revenue. Analysts surveyed by Yahoo! Finance had expected net income of 15 cents a share on $122.47 million in revenue.
"When we entered 2013, our primary financial goal was to generate profitability for the year as a whole," said CEO Mory Ejabat in a statement. "Having achieved both top line growth and profitability, we enter 2014 with two primary financial objectives: generating continued revenue growth and improving profitability."
TheStreet Ratings team rates ZHONE TECHNOLOGIES INC as a Hold with a ratings score of C. The team has this to say about their recommendation:
"We rate ZHONE TECHNOLOGIES INC (ZHNE) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and revenue growth. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."