It's Showtime for DreamWorks Animation SKG

Seth Jayson, The Motley Fool
Updated

DreamWorks Animation SKG (NAS: DWA) is expected to report Q1 earnings on April 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 compress -29.5% and EPS will shrink to a loss.

The average estimate for revenue is $96.0 million. On the bottom line, the average EPS estimate is -$0.01.


Revenue details
 Last quarter, DreamWorks Animation SKG reported revenue of $264.7 million. GAAP reported sales were 21% higher than the prior-year quarter's $219.0 million.

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

EPS details
 Last quarter, non-GAAP EPS came in at $0.31. GAAP EPS were -$0.98 for Q4 versus $0.28 per share for the prior-year quarter.

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 24.7%, 250 basis points worse than the prior-year quarter. Operating margin was 12.3%, 220 basis points worse than the prior-year quarter. Net margin was -31.3%, much worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $684.9 million. The average EPS estimate is $0.66.

Investor sentiment
 The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,107 members out of 1,182 rating the stock outperform, and 75 members rating it underperform. Among 338 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 323 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 $18.63.

Looking for alternatives to DreamWorks Animation SKG? It takes more than great companies to build a fortune for the future. Learn the basic financial habits of millionaires next door and get focused stock ideas in our free report, "3 Stocks That Will Help You Retire Rich." Click here for instant access to this free report.

The article It's Showtime for DreamWorks Animation SKG 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 recommends 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.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Advertisement