Electro Rent Whiffs on Revenues

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Electro Rent (NAS: ELRC) reported earnings on April 4. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 29 (Q3), Electro Rent whiffed on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue increased slightly and GAAP earnings per share was unchanged.


Gross margins expanded, operating margins dropped, net margins shrank.

Revenue details
Electro Rent booked revenue of $60.1 million. The one analyst polled by S&P Capital IQ expected to see sales of $67.4 million on the same basis. GAAP reported sales were 1.1% higher than the prior-year quarter's $59.5 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
EPS came in at $0.21. The one earnings estimate compiled by S&P Capital IQ anticipated $0.27 per share. GAAP EPS of $0.21 were the same as 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 39.2%, 130 basis points better than the prior-year quarter. Operating margin was 13.1%, 90 basis points worse than the prior-year quarter. Net margin was 8.3%, 20 basis points worse than the prior-year quarter.

Looking ahead
On the bottom line, the average EPS estimate is $0.24.

Next year's average estimate for revenue is $242.1 million. The average EPS estimate is $0.91.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 20 members out of 40 rating the stock outperform, and 20 members rating it underperform. Among 17 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), five give Electro Rent a green thumbs-up, and 12 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Electro Rent is buy, with an average price target of $24.00.

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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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