How the Wheels Came Off USA Mobility's Bus

USA Mobility (Nasdaq: USMO  ) reported earnings on Feb. 22. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), USA Mobility met expectations on revenues and whiffed on earnings per share.

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

Margins contracted across the board.

Revenue details
USA Mobility reported revenue of $58.9 million. The one analyst polled by S&P Capital IQ predicted revenue of $59.6 million on the same basis. GAAP reported sales were 7.8% higher than the prior-year quarter's $54.6 million.

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

EPS details
Non-GAAP EPS came in at $0.43. The one earnings estimate compiled by S&P Capital IQ averaged $0.60 per share on the same basis. GAAP EPS of $0.84 for Q4 were 54% lower than the prior-year quarter's $1.81 per share.

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 66.2%, 220 basis points worse than the prior-year quarter. Operating margin was 21.1%, 1,400 basis points worse than the prior-year quarter. Net margin was 32.1%, 4,210 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $58.4 million. On the bottom line, the average EPS estimate is $0.56.

Next year's average estimate for revenue is $228.1 million. The average EPS estimate is $2.11.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 193 members out of 220 rating the stock outperform, and 27 members rating it underperform. Among 59 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 46 give USA Mobility a green thumbs-up, and 13 give it a red thumbs-down.

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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 of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of USA Mobility. 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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4/23/2014 3:59 PM
USMO $16.80 Down -0.40 -2.33%
USA Mobility, Inc. CAPS Rating: ****

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