Knight Capital Group (NYS: KCG) reported earnings on Jan. 19. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Knight Capital Group beat expectations on revenue and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly, and earnings per share improved significantly.
Gross margins shrank, operating margins grew, and net margins increased.
Knight Capital Group recorded revenue of $341.3 million. The five analysts polled by S&P Capital IQ hoped for sales of $322.1 million. Sales were 32% higher than the prior-year quarter's $259.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.42. The eight earnings estimates compiled by S&P Capital IQ forecast $0.25 per share on the same basis. GAAP EPS of $0.43 for Q4 were 363% higher than the prior-year quarter's $0.09 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 71.4%, 50 basis points worse than the prior-year quarter. Operating margin was 19.4%, 1,440 basis points better than the prior-year quarter. Net margin was 12.2%, 850 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $310.4 million. On the bottom line, the average EPS estimate is $0.33.
Next year's average estimate for revenue is $1.25 billion. The average EPS estimate is $1.41.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 324 members out of 336 rating the stock outperform, and 12 members rating it underperform. Among 99 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 95 give Knight Capital Group 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 Knight Capital Group is hold, with an average price target of $15.19.
Over the decades, small-cap stocks like Knight Capital Group have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
Add Knight Capital Group to My Watchlist.
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.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.