SPX Increases Sales but Misses Revenue Estimate

Seth Jayson, The Motley Fool
Updated

SPX (NYS: SPW) reported earnings on Aug. 1. Here are the numbers you need to know.

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

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


Gross margins contracted, operating margins dropped, net margins grew.

Revenue details
 SPX notched revenue of $1.26 billion. The nine analysts polled by S&P Capital IQ predicted a top line of $1.30 billion on the same basis. GAAP reported sales were 11% higher than the prior-year quarter's $1.14 billion.

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 $0.78. The 13 earnings estimates compiled by S&P Capital IQ forecast $0.79 per share. GAAP EPS of $0.93 for Q2 were 41% higher than the prior-year quarter's $0.66 per share. (The prior-year quarter included $0.19 per share in earnings from discontinued operations.)

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 26.8%, 90 basis points worse than the prior-year quarter. Operating margin was 6.2%, 60 basis points worse than the prior-year quarter. Net margin was 3.8%, 80 basis points better than the prior-year quarter.

Looking ahead
 Next quarter's average estimate for revenue is $1.30 billion. On the bottom line, the average EPS estimate is $1.11.

Next year's average estimate for revenue is $5.13 billion. The average EPS estimate is $3.90.

Investor sentiment
 The stock has a four-star rating (out of five) at Motley Fool CAPS, with 166 members out of 178 rating the stock outperform, and 12 members rating it underperform. Among 37 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 34 give SPX a green thumbs-up, and three give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on SPX is outperform, with an average price target of $82.43.

The article SPX Increases Sales but Misses Revenue Estimate 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 co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. 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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