Digital Generation (NAS: DGIT) reported earnings yesterday. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended March 31 (Q1), Digital Generation beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share shrank significantly.
Margins contracted across the board.
Digital Generation logged revenue of $92.8 million. The eight analysts polled by S&P Capital IQ predicted sales of $91.1 million on the same basis. GAAP reported sales were 46% higher than the prior-year quarter's $63.5 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.31. The seven earnings estimates compiled by S&P Capital IQ predicted $0.28 per share. GAAP EPS of $0.04 for Q1 were 91% lower than the prior-year quarter's $0.44 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 65.0%, 110 basis points worse than the prior-year quarter. Operating margin was 12.8%, 2,090 basis points worse than the prior-year quarter. Net margin was 1.1%, 1,890 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $104 million. On the bottom line, the average EPS estimate is $0.42.
Next year's average estimate for revenue is $418.4 million. The average EPS estimate is $1.75.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 246 members rating the stock outperform and 10 members rating it underperform. Among 50 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 49 give Digital Generation a green thumbs-up, and one give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Digital Generation is outperform, with an average price target of $17.57.
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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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