The Gory Details of Medical Properties Trust's Double Miss

Seth Jayson, The Motley Fool
Updated

Medical Properties Trust (NYS: MPW) reported earnings on Jan. 31. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Medical Properties Trust missed estimates on revenue and missed expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded significantly, and GAAP earnings per share expanded.

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

Revenue details
Medical Properties Trust reported revenue of $36.8 million. The six analysts polled by S&P Capital IQ wanted to see revenue of $40.2 million. Sales were 23% higher than the prior-year quarter's $31.8 million.

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

EPS details
Non-GAAP EPS came in at $0.08. The one earnings estimate compiled by S&P Capital IQ forecast $0.31 per share on the same basis. GAAP EPS of $0.11 for Q4 were 23% higher than the prior-year quarter's $0.09 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 98.7%, 660 basis points better than the prior-year quarter. Operating margin was 55.4%, 110 basis points better than the prior-year quarter. Net margin was 34.5%, 100 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $42.7 million. On the bottom line, the average EPS estimate is $0.33.

Next year's average estimate for revenue is $180.2 million. The average EPS estimate is $1.31.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 255 members out of 279 rating the stock outperform, and 24 members rating it underperform. Among 78 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 75 give Medical Properties Trust a green thumbs-up, and three give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Medical Properties Trust is hold, with an average price target of $11.83.

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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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