ITT Goes Negative

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ITT (NYS: ITT) filed its 10-K on Feb. 29. Here are the numbers you need to know.

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

Compared to the prior-year quarter, revenue dropped significantly and GAAP earnings per share contracted to a loss.

Gross margins contracted, operating margins contracted, net margins improved.

Revenue details
ITT recorded revenue of $518.0 million. The three analysts polled by S&P Capital IQ expected sales of $508.8 million on the same basis. GAAP reported sales were 9.8% higher than the prior-year quarter's -$6.05 billion.

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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 $0.36. The five earnings estimates compiled by S&P Capital IQ averaged $0.36 per share on the same basis. GAAP EPS were -$5.38 for Q4 compared to $2.96 per share for the prior-year quarter.

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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 27.5%, 10 basis points worse than the prior-year quarter. Operating margin was 11.0%, 130 basis points worse than the prior-year quarter. Net margin was 7.5%, 1,200 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $550.2 million. On the bottom line, the average EPS estimate is $0.33.

Next year's average estimate for revenue is $2.27 billion. The average EPS estimate is $1.69.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 350 members out of 366 rating the stock outperform, and 16 members rating it underperform. Among 101 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 98 give ITT 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 ITT is hold, with an average price target of $24.57.

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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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