Mead Johnson Nutrition Beats Estimates Yet Again

Mead Johnson Nutrition (NYS: MJN) reported earnings on Jan. 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Mead Johnson Nutrition beat slightly on both revenues and earnings per share.

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

Gross margins shrank, operating margins improved, and net margins dropped.

Revenue details
Mead Johnson Nutrition logged revenue of $911.3 million. The nine analysts polled by S&P Capital IQ expected a top line of $894.0 million. Sales were 13% higher than the prior-year quarter's $803.7 million.


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

EPS details
Non-GAAP EPS came in at $0.52. The 12 earnings estimates compiled by S&P Capital IQ predicted $0.51 per share on the same basis. GAAP EPS of $0.42 for Q4 were 12% lower than the prior-year quarter's $0.48 per share.


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 61.1%, 120 basis points worse than the prior-year quarter. Operating margin was 16.0%, 150 basis points better than the prior-year quarter. Net margin was 9.4%, 300 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $981.6 million. On the bottom line, the average EPS estimate is $0.82.

Next year's average estimate for revenue is $4.01 billion. The average EPS estimate is $3.17.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 78 members out of 92 rating the stock outperform, and 14 members rating it underperform. Among 32 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 25 give Mead Johnson Nutrition a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Mead Johnson Nutrition is outperform, with an average price target of $77.33.

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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