Mac-Gray Misses on Both Revenue and Earnings

Seth Jayson, The Motley Fool
Updated

Mac-Gray (NYS: TUC) reported earnings on May 2. Here are the numbers you need to know.

The 10-second takeaway
 For the quarter ended March 31 (Q1), Mac-Gray missed estimates on revenues and missed estimates on earnings per share.

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


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

Revenue details
 Mac-Gray reported revenue of $81.6 million. The two analysts polled by S&P Capital IQ foresaw a top line of $85.1 million on the same basis. GAAP reported sales were the same as the prior-year quarter's.

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 $0.19. The three earnings estimates compiled by S&P Capital IQ predicted $0.21 per share. GAAP EPS were $0.19 for Q1 compared to -$0.05 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 30.9%, 10 basis points worse than the prior-year quarter. Operating margin was 8.0%, 100 basis points better than the prior-year quarter. Net margin was 3.6%, 450 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
 Next quarter's average estimate for revenue is $79.6 million. On the bottom line, the average EPS estimate is $0.13.

Next year's average estimate for revenue is $325.3 million. The average EPS estimate is $0.67.

Investor sentiment
 The stock has a one-star rating (out of five) at Motley Fool CAPS, with 22 members out of 31 rating the stock outperform, and nine members rating it underperform. Among 10 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), eight give Mac-Gray a green thumbs-up, and two give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Mac-Gray is outperform, with an average price target of $18.00.

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The article Mac-Gray Misses on Both Revenue and 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 co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Mac-Gray. 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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