Fossil Beats Analyst Estimates on EPS

Seth Jayson, The Motley Fool
Updated

Fossil (NAS: FOSL) reported earnings on Feb. 14. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Fossil met expectations on revenue and beat expectations on earnings per share.

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

Gross margin dropped, operating margin contracted, and net margin improved.

Revenue details
Fossil reported revenue of $830.8 million. The 12 analysts polled by S&P Capital IQ expected revenue of $841.2 million on the same basis. GAAP reported sales were 18% higher than the prior-year quarter's $701.1 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.87. The 15 earnings estimates compiled by S&P Capital IQ predicted $1.77 per share. GAAP EPS of $1.87 for Q4 were 28% higher than the prior-year quarter's $1.46 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 56.1%, 100 basis points worse than the prior-year quarter. Operating margin was 21.0%, 120 basis points worse than the prior-year quarter. Net margin was 14.2%, 40 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $617.6 million. On the bottom line, the average EPS estimate is $0.98.

Next year's average estimate for revenue is $2.99 billion. The average EPS estimate is $5.45.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 466 members out of 523 rating the stock outperform, and 60 members rating it underperform. Among 193 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 184 give Fossil a green thumbs-up, and nine give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Fossil is outperform, with an average price target of $112.10.

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At the time thisarticle was published Seth Jayson owned shares of the following at the time of publication: Fossil. 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. The Motley Fool owns shares of Fossil. Motley Fool newsletter services have recommended buying shares of Fossil. Motley Fool newsletter services have also recommended shorting Fossil. 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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