Twin Disc Increases Sales but Misses Revenue Estimates

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Twin Disc (NAS: TWIN) reported earnings on Jan. 23. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 30 (Q2), Twin Disc missed on revenues and whiffed on earnings per share.

Compared to the prior-year quarter, revenue grew and earnings per share improved significantly.

Margins grew across the board.

Revenue details
Twin Disc tallied revenue of $83 million. The three analysts polled by S&P Capital IQ hoped for sales of $89 million. Sales were 10% higher than the prior-year quarter's $75 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
EPS came in at $0.51. The three earnings estimates compiled by S&P Capital IQ averaged $0.60 per share. GAAP EPS of $0.51 for Q2 were 46% higher than the prior-year quarter's $0.35 per share.

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Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 35.6%, 400 basis points better than the prior-year quarter. Operating margin was 11.4%, 460 basis points better than the prior-year quarter. Net margin was 7.1%, 170 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $91 million. On the bottom line, the average EPS estimate is $0.66.

Next year's average estimate for revenue is $373 million. The average EPS estimate is $2.93.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 314 members out of 321 rating the stock outperform, and seven members rating it underperform. Among 106 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 103 give Twin Disc a green thumbs-up, and three give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Twin Disc is buy, with an average price target of $46.

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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. 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.

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