DCP Midstream Partners Crushes Earnings Estimates

Seth Jayson, The Motley Fool
Updated

DCP Midstream Partners (NYS: DPM) reported earnings on May 8. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), DCP Midstream Partners met expectations on revenues and crushed expectations on earnings per share.

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


Gross margins shrank, operating margins grew, net margins expanded.

Revenue details
DCP Midstream Partners reported revenue of $525.6 million. The four analysts polled by S&P Capital IQ predicted revenue of $531.1 million on the same basis. GAAP reported sales were 13% higher than the prior-year quarter's $465.3 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 $0.77. The six earnings estimates compiled by S&P Capital IQ anticipated $0.50 per share. GAAP EPS were $0.26 for Q1 compared to -$0.28 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 13.0%, 120 basis points worse than the prior-year quarter. Operating margin was 5.9%, 650 basis points better than the prior-year quarter. Net margin was 4.4%, 690 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $429.8 million. On the bottom line, the average EPS estimate is $0.21.

Next year's average estimate for revenue is $1.81 billion. The average EPS estimate is $1.41.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 201 members out of 212 rating the stock outperform, and 11 members rating it underperform. Among 71 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 70 give DCP Midstream Partners 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 DCP Midstream Partners is outperform, with an average price target of $51.60.

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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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