WebMD Health Goes Red

Seth Jayson, The Motley Fool
Updated

WebMD Health (NAS: WBMD) reported earnings on May 1. Here are the numbers you need to know.

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

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


Margins contracted across the board.

Revenue details
WebMD Health reported revenue of $106.9 million. The seven analysts polled by S&P Capital IQ expected revenue of $106.7 million on the same basis. GAAP reported sales were 19% lower than the prior-year quarter's $131.6 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 -$0.22. The seven earnings estimates compiled by S&P Capital IQ averaged -$0.13 per share. GAAP EPS were -$0.14 for Q1, versus $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 50%, 1,320 basis points worse than the prior-year quarter. Operating margin was -11.8%, 2,820 basis points worse than the prior-year quarter. Net margin was -7.3%, 2,220 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $123.1 million. On the bottom line, the average EPS estimate is $0.01.

Next year's average estimate for revenue is $506.8 million. The average EPS estimate is $0.11.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 111 members rating the stock outperform and 56 members rating it underperform. Among 49 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 30 give WebMD Health a green thumbs-up, and 19 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on WebMD Health is hold, with an average price target of $23.67.

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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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