Providence Service Beats on the Top Line

Seth Jayson, The Motley Fool
Updated

Providence Service (NAS: PRSC) reported earnings on March 14. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Providence Service met expectations on revenues and missed estimates on earnings per share.

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

Margins dropped across the board.

Revenue details
Providence Service recorded revenue of $244.3 million. The three analysts polled by S&P Capital IQ looked for sales of $244.4 million on the same basis. GAAP reported sales were 11% higher than the prior-year quarter's $219.3 million.

anImage
anImage

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 $0.22. The two earnings estimates compiled by S&P Capital IQ forecast $0.23 per share. GAAP EPS of $0.22 for Q4 were 42% lower than the prior-year quarter's $0.38 per share.

anImage
anImage

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 9.2%, 270 basis points worse than the prior-year quarter. Operating margin was 2.9%, 220 basis points worse than the prior-year quarter. Net margin was 1.2%, 80 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $249.7 million. On the bottom line, the average EPS estimate is $0.40.

Next year's average estimate for revenue is $1.01 billion. The average EPS estimate is $1.28.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 71 members rating the stock outperform and 20 members rating it underperform. Among 24 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 18 give Providence Service 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 Providence Service is outperform, with an average price target of $15.67.

If you're interested in health-care stocks like Providence Service, you might want to expand your horizons to find maximum returns. Follow the money and meet a prime candidate for major returns in our new report, "Discover the Next Rule-Breaking Multibagger." Click here for instant access to this free report.

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.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Advertisement