Sunrise Senior Living Makes Analysts Look Bad

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Sunrise Senior Living (NYS: SRZ) reported earnings yesterday. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Sunrise Senior Living missed slightly on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded, and GAAP earnings per share dropped significantly. The non-GAAP profit was a surprise, as analysts had predicted a loss.

Gross margins were steady, operating margins shrank, and net margins dropped.

Revenue details
Sunrise Senior Living tallied revenue of $330.6 million. The one analyst polled by S&P Capital IQ expected to see a top line of $337.1 million on the same basis. GAAP reported sales were 3.6% higher than the prior-year quarter's $319 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.17. The one earnings estimate compiled by S&P Capital IQ anticipated -$0.07 per share on the same basis. GAAP EPS of $0.02 for Q4 were 98% lower than the prior-year quarter's $0.86 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 18.6%, about the same as the prior-year quarter. Operating margin was 0.5%, 280 basis points worse than the prior-year quarter. Net margin was 0.5%, 1,520 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $337.8 million. On the bottom line, the average EPS estimate is -$0.02.

Next year's average estimate for revenue is $1.36 billion. The average EPS estimate is $0.05.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 485 members rating the stock outperform and 53 members rating it underperform. Among 141 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 128 give Sunrise Senior Living a green thumbs-up, and 13 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Sunrise Senior Living is buy, with an average price target of $10.

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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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