Deluxe Beats Estimates Yet Again

Seth Jayson, The Motley Fool
Updated

Deluxe (NYS: DLX) reported earnings on Jan. 26. Here are the numbers you need to know.

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

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

Gross margins were steady, operating margins increased, and net margins expanded.

Revenue details
Deluxe reported revenue of $366.4 million. The four analysts polled by S&P Capital IQ anticipated a top line of $364.0 million. Sales were 4.2% higher than the prior-year quarter's $351.5 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
Non-GAAP EPS came in at $0.83. The four earnings estimates compiled by S&P Capital IQ anticipated $0.81 per share on the same basis. GAAP EPS of $0.78 for Q4 were 15% higher than the prior-year quarter's $0.68 per share.

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Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 64.5%, about the same as the prior-year quarter. Operating margin was 21.0%, 150 basis points better than the prior-year quarter. Net margin was 10.9%, 100 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $354.7 million. On the bottom line, the average EPS estimate is $0.78.

Next year's average estimate for revenue is $1.43 billion. The average EPS estimate is $3.19.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 182 members out of 203 rating the stock outperform, and 21 members rating it underperform. Among 62 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 56 give Deluxe a green thumbs-up, and six give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Deluxe is outperform, with an average price target of $31.00.

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At the time thisarticle 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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