Golf Clap for Virtusa

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Virtusa (NAS: VRTU) reported earnings on May 9. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q4), Virtusa met expectations on revenues and earnings per share.

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


Gross margins contracted, operating margins grew, net margins dropped.

Revenue details
Virtusa logged revenue of $74.2 million. The eight analysts polled by S&P Capital IQ wanted to see a top line of $74.4 million on the same basis. GAAP reported sales were 27% higher than the prior-year quarter's $58.3 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 $0.23. The six earnings estimates compiled by S&P Capital IQ anticipated $0.23 per share. GAAP EPS of $0.23 for Q4 were 9.5% higher than the prior-year quarter's $0.21 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 35.6%, 130 basis points worse than the prior-year quarter. Operating margin was 9.5%, 320 basis points better than the prior-year quarter. Net margin was 7.8%, 120 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $76.8 million. On the bottom line, the average EPS estimate is $0.22.

Next year's average estimate for revenue is $326.4 million. The average EPS estimate is $1.04.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 96 members out of 102 rating the stock outperform, and six members rating it underperform. Among 29 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 29 give Virtusa a green thumbs-up, and give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Virtusa is outperform, with an average price target of $20.00.

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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. 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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