Sunrise Senior Living Meets on the Top Line but Misses Where It Counts

Seth Jayson, The Motley Fool
Updated

Sunrise Senior Living (NYS: SRZ) reported earnings on May 1. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Sunrise Senior Living met expectations on revenues and missed expectations on earnings per share.

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


Gross margin contracted, while both operating margin and net margin grew.

Revenue details
Sunrise Senior Living reported revenue of $335.7 million. The two analysts polled by S&P Capital IQ hoped for revenue of $335 million on the same basis. GAAP-reported sales were much higher than the prior-year quarter's $134.9 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 -$0.03. The two earnings estimates compiled by S&P Capital IQ anticipated $0.07 per share. GAAP EPS were $0.03 for Q1 against -$0.32 per share for the prior-year quarter.

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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 12.8%, 2,630 basis points worse than the prior-year quarter. Operating margin was 0.7%, 640 basis points better than the prior-year quarter. Net margin was 0.6%, 1,370 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $337.1 million. On the bottom line, the average EPS estimate is $0.10.

Next year's average estimate for revenue is $1.35 billion. The average EPS estimate is $0.31.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 483 members rating the stock outperform and 52 members rating it underperform. Among 137 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 124 give Sunrise Senior Living a green thumbs-up, and 13 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Sunrise Senior Living is buy, with an average price target of $10.

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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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