USG Increases Sales but Misses Estimates on Earnings

Seth Jayson, The Motley Fool
Updated

USG (NYS: USG) reported earnings on July 25. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended June 30 (Q2), USG missed estimates on revenues and missed expectations on earnings per share.

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


Margins improved across the board.

Revenue details
USG booked revenue of $825.0 million. The 12 analysts polled by S&P Capital IQ hoped for net sales of $848.4 million on the same basis. GAAP reported sales were 8.4% higher than the prior-year quarter's $761.0 million.

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 -$0.15. The 14 earnings estimates compiled by S&P Capital IQ predicted -$0.11 per share. GAAP EPS were -$0.54 for Q2 versus -$0.69 per share for the prior-year quarter.

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 13.2%, 620 basis points better than the prior-year quarter. Operating margin was 3.8%, 630 basis points better than the prior-year quarter. Net margin was -6.9%, 230 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $877.9 million. On the bottom line, the average EPS estimate is -$0.04.

Next year's average estimate for revenue is $3.37 billion. The average EPS estimate is -$0.61.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,713 members out of 1,853 rating the stock outperform, and 140 members rating it underperform. Among 467 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 433 give USG a green thumbs-up, and 34 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on USG is hold, with an average price target of $19.80.

Over the decades, small-cap stocks, like USG have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Get instant access to this free report.

The article USG Increases Sales but Misses Estimates on Earnings originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is the 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 don't 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.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Advertisement