McGraw-Hill Beats Analyst Estimates on EPS
McGraw-Hill (NYS: MHP) reported earnings on Jan. 31. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended Dec. 31 (Q4), McGraw-Hill met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share grew significantly.
Gross margins shrank, operating margins dropped, and net margins grew.
McGraw-Hill notched revenue of $1.52 billion. The seven analysts polled by S&P Capital IQ expected to see revenue of $1.54 billion. Sales were 0.3% lower than the prior-year quarter's $1.52 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.63. The seven earnings estimates compiled by S&P Capital IQ predicted $0.57 per share on the same basis. GAAP EPS of $0.74 for Q4 were 48% higher than the prior-year quarter's $0.50 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 15.9%, 4,550 basis points worse than the prior-year quarter. Operating margin was 15.9%, 200 basis points worse than the prior-year quarter. Net margin was 14.1%, 400 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.32 billion. On the bottom line, the average EPS estimate is $0.44.
Next year's average estimate for revenue is $6.55 billion. The average EPS estimate is $3.24.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 484 members out of 530 rating the stock outperform, and 46 members rating it underperform. Among 223 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 200 give McGraw-Hill a green thumbs-up, and 23 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on McGraw-Hill is outperform, with an average price target of $47.14.
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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 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.