Rowan Companies Misses Where it Counts

Seth Jayson, The Motley Fool
Updated

Rowan Companies (NYS: RDC) reported earnings on Feb. 28. Here are the numbers you need to know.

The 10-second takeaway
 For the quarter ended Dec. 31 (Q4), Rowan Companies met expectations on revenues and missed estimates on earnings per share.

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


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

Revenue details
 Rowan Companies notched revenue of $354.2 million. The 20 analysts polled by S&P Capital IQ expected revenue of $355.9 million on the same basis. GAAP reported sales were 29% higher than the prior-year quarter's $275.1 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 $0.44. The 32 earnings estimates compiled by S&P Capital IQ forecast $0.49 per share. GAAP EPS of $0.44 for Q4 were 26% higher than the prior-year quarter's $0.35 per share. (The prior-year quarter included $0.10 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 45.3%, 440 basis points better than the prior-year quarter. Operating margin was 19.8%, 710 basis points better than the prior-year quarter. Net margin was 15.3%, 110 basis points worse than the prior-year quarter.

Looking ahead
 Next quarter's average estimate for revenue is $384.3 million. On the bottom line, the average EPS estimate is $0.65.

Next year's average estimate for revenue is $1.55 billion. The average EPS estimate is $2.35.

Investor sentiment
 The stock has a three-star rating (out of five) at Motley Fool CAPS, with 570 members out of 601 rating the stock outperform, and 31 members rating it underperform. Among 161 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 153 give Rowan Companies a green thumbs-up, and eight give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Rowan Companies is outperform, with an average price target of $38.56.

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The article Rowan Companies Misses Where it Counts 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 position in any of the stocks mentioned. 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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