The 10-second takeaway
For the quarter ended June 29 (Q1), Computer Sciences beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share contracted significantly.
Gross margins increased, operating margins improved, net margins contracted.
Computer Sciences reported revenue of $3.96 billion. The 12 analysts polled by S&P Capital IQ expected a top line of $3.89 billion on the same basis. GAAP reported sales were 1.9% lower than the prior-year quarter's $4.03 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 $0.36. The 13 earnings estimates compiled by S&P Capital IQ averaged $0.22 per share. GAAP EPS of $0.26 for Q1 were 78% lower than the prior-year quarter's $1.17 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 17.8%, 120 basis points better than the prior-year quarter. Operating margin was 3.8%, 70 basis points better than the prior-year quarter. Net margin was 1.0%, 350 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $3.87 billion. On the bottom line, the average EPS estimate is $0.42.
Next year's average estimate for revenue is $15.63 billion. The average EPS estimate is $2.05.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 261 members out of 305 rating the stock outperform, and 44 members rating it underperform. Among 86 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 75 give Computer Sciences a green thumbs-up, and 11 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Computer Sciences is hold, with an average price target of $28.05.
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