International Speedway Earnings Preview

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Investors never know what to expect for International Speedway (NAS: ISCA) , as it has wavered between topping and missing analysts estimates during the past fiscal year. The company will unveil its latest earnings Thursday. International Speedway is an owner of major motorsports entertainment facilities and promoter of motorsports-themed entertainment in the United States.

What analysts say:
 

  • Buy, sell, or hold?: The majority of analysts back International Speedway as a buy. But with 60% of analysts rating it a buy, International Speedway is still below the mean analyst rating of its nearest 10 competitors, which average 66.7% buys. Analysts don't like International Speedway as much as competitor Churchill Downs overall. Three out of four analysts rate Churchill Downs a buy compared to three of five for International Speedway. Wall Street has warmed to the stock over the past three months, with analysts increasing their endorsement from hold to moderate buy.
  • Revenue forecasts: On average, analysts predict $156.5 million in revenue this quarter. That would represent a decline of 2.3% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.31 per share. Estimates range from $0.27 to $0.34.

What our community says:
CAPS All-Stars are solidly backing the stock with 91.2% assigning it an outperform rating. The community at large agrees with the All-Stars with 87.8% granting it a rating of outperform. Fools are gung-ho about International Speedway, though the message boards have been quiet lately with only 61 posts in the past 30 days. Though still bullish, the CAPS rating of four out of five stars for International Speedway is a bit more pessimistic than the community assessment.

Management:
International Speedway's profit has risen year over year by an average of 12.7% over the past five quarters. Revenue has fallen for the past three quarters. The company's gross margin shrank by 20.7 percentage points in the last quarter. Revenue fell 2.4% while cost of sales rose 63% to $71.7 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

48.3%

56.2%

48.1%

42.0%

Operating Margin

17.3%

26.5%

20.7%

13.5%

Net Margin

8.6%

14.4%

8.0%

2.3%

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Motley Fool newsletter services have recommended buying shares of International Speedway.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

At the time this article was published

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