HCP Increases Sales but Misses Estimates on Earnings

Seth Jayson, The Motley Fool
Updated

HCP (NYS: HCP) reported earnings on Feb. 14. Here are the numbers you need to know.

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

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

Gross margin increased, operating margin expanded, and net margin dropped.

Revenue details
HCP logged revenue of $461.6 million. The eight analysts polled by S&P Capital IQ expected revenue of $454.2 million on the same basis. GAAP reported sales were 35% higher than the prior-year quarter's $341.1 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 $0.15. The four earnings estimates compiled by S&P Capital IQ anticipated $0.38 per share. GAAP EPS of $0.15 for Q4 were 92% lower than the prior-year quarter's $1.81 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 85.0%, 210 basis points better than the prior-year quarter. Operating margin was 60.8%, 600 basis points better than the prior-year quarter. Net margin was 14.7%, 2,690 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $453.1 million. On the bottom line, the average EPS estimate is $0.44.

Next year's average estimate for revenue is $1.88 billion. The average EPS estimate is $1.82.

Investor sentiment

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on HCP is hold, with an average price target of $38.33.

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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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