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Apache Increases Sales but Misses Estimates on Earnings

Apache (NYSE: APA  ) reported earnings on May 3. Here are the numbers you need to know.

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

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

Gross margins increased, operating margins shrank, net margins contracted.

Revenue details
Apache tallied revenue of $4.54 billion. The 14 analysts polled by S&P Capital IQ anticipated sales of $4.49 billion on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $3.88 billion.

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 $3.00. The 26 earnings estimates compiled by S&P Capital IQ predicted $3.08 per share. GAAP EPS of $2.00 for Q1 were 30% lower than the prior-year quarter's $2.86 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 83.5%, 30 basis points better than the prior-year quarter. Operating margin was 35.4%, 1,560 basis points worse than the prior-year quarter. Net margin was 17.6%, 1,160 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $4.57 billion. On the bottom line, the average EPS estimate is $2.95.

Next year's average estimate for revenue is $18.82 billion. The average EPS estimate is $12.15.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,998 members out of 2,052 rating the stock outperform, and 55 members rating it underperform. Among 395 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 388 give Apache a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Apache is outperform, with an average price target of $131.34.

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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. 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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5/26/2016 2:15 PM
APA $58.27 Up +0.36 +0.62%
Apache Corp CAPS Rating: ****