Lufkin Industries Misses Where It Counts

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Lufkin Industries (NAS: LUFK) reported earnings on May 7. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Lufkin Industries beat slightly on revenues and missed estimates on earnings per share.

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


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

Revenue details
Lufkin Industries notched revenue of $279.5 million. The four analysts polled by S&P Capital IQ expected a top line of $276.1 million on the same basis. GAAP reported sales were 44% higher than the prior-year quarter's $194.4 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 $0.56. The eight earnings estimates compiled by S&P Capital IQ anticipated $0.59 per share. GAAP EPS of $0.34 for Q1 were 15% lower than the prior-year quarter's $0.40 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 24.2%, 40 basis points better than the prior-year quarter. Operating margin was 11.2%, 120 basis points better than the prior-year quarter. Net margin was 3.9%, 250 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $316.0 million. On the bottom line, the average EPS estimate is $0.95.

Next year's average estimate for revenue is $1.29 billion. The average EPS estimate is $4.08.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 601 members out of 625 rating the stock outperform, and 24 members rating it underperform. Among 185 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 181 give Lufkin Industries a green thumbs-up, and four give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Lufkin Industries is outperform, with an average price target of $94.50.

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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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