E-Commerce China Dangdang Increases Sales but Misses Revenue Estimate

Seth Jayson, The Motley Fool
Updated

E-Commerce China Dangdang (NYS: DANG) reported earnings on May 17. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), E-Commerce China Dangdang missed estimates on revenues and exceeded expectations on earnings per share.

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


Margins dropped across the board.

Revenue details
E-Commerce China Dangdang notched revenue of $172.1 million. The nine analysts polled by S&P Capital IQ foresaw a top line of $175.8 million on the same basis. GAAP reported sales were 64% higher than the prior-year quarter's $105.0 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 -$0.20. The seven earnings estimates compiled by S&P Capital IQ anticipated -$0.22 per share. GAAP EPS were -$0.04 for Q1 compared to $0.00 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 14.2%, 530 basis points worse than the prior-year quarter. Operating margin was -9.9%, 970 basis points worse than the prior-year quarter. Net margin was -9.2%, 960 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $186.9 million. On the bottom line, the average EPS estimate is -$0.20.

Next year's average estimate for revenue is $863.4 million. The average EPS estimate is -$0.87.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 183 members rating the stock outperform and 69 members rating it underperform. Among 41 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 21 give E-Commerce China Dangdang a green thumbs-up, and 20 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on E-Commerce China Dangdang is hold, with an average price target of $7.89.

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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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