The 10-second takeaway
For the quarter ended June 30 (Q2), CenturyLink met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share contracted significantly.
Margins shrank across the board.
CenturyLink reported revenue of $4.61 billion. The 17 analysts polled by S&P Capital IQ anticipated a top line of $4.57 billion on the same basis. GAAP reported sales were 4.7% higher than the prior-year quarter's $4.41 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.65. The 20 earnings estimates compiled by S&P Capital IQ predicted $0.61 per share. GAAP EPS of $0.12 for Q2 were 37% lower than the prior-year quarter's $0.19 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 58.5%, 100 basis points worse than the prior-year quarter. Operating margin was 14.2%, 270 basis points worse than the prior-year quarter. Net margin was 1.6%, 100 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $4.56 billion. On the bottom line, the average EPS estimate is $0.60.
Next year's average estimate for revenue is $18.31 billion. The average EPS estimate is $2.49.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 522 members out of 566 rating the stock outperform, and 44 members rating it underperform. Among 167 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 151 give CenturyLink a green thumbs-up, and 16 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on CenturyLink is outperform, with an average price target of $43.74.
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