Georgia Gulf Crushes Earnings Estimates

Seth Jayson, The Motley Fool
Updated

Georgia Gulf (NYS: GGC) reported earnings yesterday. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Georgia Gulf beat expectations on revenues and crushed expectations on earnings per share.

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


Margins expanded across the board.

Revenue details
Georgia Gulf reported revenue of $859.9 million. The five analysts polled by S&P Capital IQ wanted to see sales of $838.8 million on the same basis. GAAP reported sales were 9.1% higher than the prior-year quarter's $787.9 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 $0.79. The six earnings estimates compiled by S&P Capital IQ averaged $0.56 per share. GAAP EPS of $1.03 for Q1 were 194% higher than the prior-year quarter's $0.35 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 12.0%, 240 basis points better than the prior-year quarter. Operating margin was 6.5%, 180 basis points better than the prior-year quarter. Net margin was 4.1%, 260 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $887.9 million. On the bottom line, the average EPS estimate is $0.54.

Next year's average estimate for revenue is $3.50 billion. The average EPS estimate is $2.58.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 116 members rating the stock outperform and 28 members rating it underperform. Among 37 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 30 give Georgia Gulf a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Georgia Gulf is hold, with an average price target of $37.83.

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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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