The Gory Details on Coherent's Double Miss

Seth Jayson, The Motley Fool
Updated

Coherent (NAS: COHR) reported earnings on Jan. 25. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q1), Coherent missed slightly on revenues and missed expectations on earnings per share.

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

Margins dropped across the board.

Revenue details
Coherent recorded revenue of $190.8 million. The two analysts polled by S&P Capital IQ expected to see revenue of $194.4 million. Sales were 4.2% higher than the prior-year quarter's $183.1 million.

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

EPS details
Non-GAAP EPS came in at $0.82. The five earnings estimates compiled by S&P Capital IQ averaged $0.82 per share on the same basis. GAAP EPS of $0.71 for Q1 were 6.6% lower than the prior-year quarter's $0.76 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 42.1%, 290 basis points worse than the prior-year quarter. Operating margin was 13.3%, 70 basis points worse than the prior-year quarter. Net margin was 8.9%, 150 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $206.3 million. On the bottom line, the average EPS estimate is $0.90.

Next year's average estimate for revenue is $833 million. The average EPS estimate is $3.72.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 78 members out of 90 rating the stock outperform, and 12 members rating it underperform. Among 39 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 33 give Coherent 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 Coherent is outperform, with an average price target of $63.83.

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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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