Gartner Increases Sales but Misses Estimates on Earnings

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Gartner (NYS: IT) reported earnings on Feb. 7. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Gartner met expectations on revenues and missed expectations on earnings per share.

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

Margins grew across the board.

Revenue details
Gartner logged revenue of $427.7 million. The nine analysts polled by S&P Capital IQ foresaw revenue of $427.6 million. Sales were 12% higher than the prior-year quarter's $382.3 million.

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

EPS details
EPS came in at $0.46. The nine earnings estimates compiled by S&P Capital IQ averaged $0.47 per share. GAAP EPS of $0.46 for Q4 were 28% higher than the prior-year quarter's $0.36 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 57.8%, 90 basis points better than the prior-year quarter. Operating margin was 16.2%, 210 basis points better than the prior-year quarter. Net margin was 10.5%, 90 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $366.7 million. On the bottom line, the average EPS estimate is $0.37.

Next year's average estimate for revenue is $1.62 billion. The average EPS estimate is $1.75.

Investor sentiment
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 76 members out of 100 rating the stock outperform, and 24 members rating it underperform. Among 31 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 29 give Gartner a green thumbs-up, and two give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Gartner is outperform, with an average price target of $42.38.

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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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