Tennant Increases Sales but Misses Estimates on Earnings

Seth Jayson, The Motley Fool
Updated

Tennant (NYS: TNC) reported earnings on April 23. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Tennant missed estimates on revenues and missed estimates on earnings per share.

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


Gross margins improved, operating margins improved, net margins dropped.

Revenue details
Tennant chalked up revenue of $173.7 million. The three analysts polled by S&P Capital IQ looked for revenue of $177.8 million on the same basis. GAAP reported sales were 0.6% higher than the prior-year quarter's $172.6 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 $0.28. The four earnings estimates compiled by S&P Capital IQ predicted $0.39 per share. GAAP EPS of $0.28 for Q1 were 6.7% lower than the prior-year quarter's $0.30 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 43.4%, 170 basis points better than the prior-year quarter. Operating margin was 4.8%, 10 basis points better than the prior-year quarter. Net margin was 3.1%, 30 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $203.3 million. On the bottom line, the average EPS estimate is $0.61.

Next year's average estimate for revenue is $795.1 million. The average EPS estimate is $2.37.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 137 members out of 146 rating the stock outperform, and nine members rating it underperform. Among 38 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 37 give Tennant a green thumbs-up, and one gives it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Tennant is outperform, with an average price target of $47.75.

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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. The Motley Fool owns shares of Tennant. Motley Fool newsletter services have recommended buying shares of Tennant. 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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