TransAlta Beats on Both Top and Bottom Lines

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TransAlta (NYS: TAC) reported earnings on April 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), TransAlta beat expectations on revenues and beat expectations on earnings per share.

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


Margins shrank across the board.

Revenue details
TransAlta logged revenue of $657.3 million. The three analysts polled by S&P Capital IQ expected net sales of $628.0 million on the same basis. GAAP reported sales were 22% lower than the prior-year quarter's $842.2 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 $0.20. The one earnings estimate compiled by S&P Capital IQ averaged $0.19 per share. GAAP EPS of $0.40 for Q1 were 58% lower than the prior-year quarter's $0.95 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 47.0%, 1,200 basis points worse than the prior-year quarter. Operating margin was 26.5%, 1,740 basis points worse than the prior-year quarter. Net margin was 14.6%, 1,080 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $630.6 million. On the bottom line, the average EPS estimate is $0.18.

Next year's average estimate for revenue is $2.61 billion. The average EPS estimate is $1.03.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 73 members out of 78 rating the stock outperform, and five members rating it underperform. Among 18 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 17 give TransAlta a green thumbs-up, and one give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on TransAlta is hold, with an average price target of $22.44.

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. He is the 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 don't 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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