What Does Wall Street See for DreamWorks Animation SKG's Q3?

Seth Jayson, The Motley Fool
Updated

DreamWorks Animation SKG (NAS: DWA) is expected to report Q3 earnings on Oct. 30. Here's what Wall Street wants to see:

The 10-second takeaway
 Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict DreamWorks Animation SKG's revenues will contract -17.2% and EPS will shrink -47.8%.

The average estimate for revenue is $133.1 million. On the bottom line, the average EPS estimate is $0.12.


Revenue details
 Last quarter, DreamWorks Animation SKG recorded revenue of $162.8 million. GAAP reported sales were 25% lower than the prior-year quarter's $218.3 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
 Last quarter, EPS came in at $0.15. GAAP EPS of $0.15 for Q2 were 63% lower than the prior-year quarter's $0.40 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
 For the preceding quarter, gross margin was 29.8%, 550 basis points worse than the prior-year quarter. Operating margin was 10.1%, 1,150 basis points worse than the prior-year quarter. Net margin was 7.8%, 780 basis points worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $673.4 million. The average EPS estimate is $0.78.

Investor sentiment
 The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,110 members out of 1,181 rating the stock outperform, and 71 members rating it underperform. Among 310 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 295 give DreamWorks Animation SKG a green thumbs-up, and 15 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on DreamWorks Animation SKG is hold, with an average price target of $17.59.

The article What Does Wall Street See for DreamWorks Animation SKG's Q3? 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. Motley Fool newsletter services recommend DreamWorks Animation. 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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