The 10-second takeaway
For the quarter ended June 30 (Q3), Ralcorp Holdings met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share improved.
Gross margins dropped, operating margins contracted, and net margins expanded.
Ralcorp Holdings notched revenue of $1.03 billion. The eight analysts polled by S&P Capital IQ predicted net sales of $1.02 billion on the same basis. GAAP reported sales were 12% lower than the prior-year quarter's $1.17 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 $0.60. The 11 earnings estimates compiled by S&P Capital IQ forecast $0.62 per share. GAAP EPS of $0.53 for Q3 were 6.0% higher than the prior-year quarter's $0.50 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 19.9%, 480 basis points worse than the prior-year quarter. Operating margin was 7.5%, 170 basis points worse than the prior-year quarter. Net margin was 2.9%, 50 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.10 billion. On the bottom line, the average EPS estimate is $0.88.
Next year's average estimate for revenue is $4.38 billion. The average EPS estimate is $3.30.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 134 members out of 142 rating the stock outperform, and eight members rating it underperform. Among 48 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 47 give Ralcorp Holdings a green thumbs-up, and one gives it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Ralcorp Holdings is outperform, with an average price target of $76.00.
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