Legacy Reserves Lp Goes Negative

Legacy Reserves Lp (Nasdaq: LGCY  ) reported earnings on Oct. 31. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Legacy Reserves Lp missed estimates on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share contracted to a loss.

Margins shrank across the board.

Revenue details
Legacy Reserves Lp recorded revenue of $84.2 million. The seven analysts polled by S&P Capital IQ expected sales of $86.5 million on the same basis. GAAP reported sales were 0.2% lower than the prior-year quarter's $84.4 million.

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 $0.23. The eight earnings estimates compiled by S&P Capital IQ predicted $0.42 per share. GAAP EPS were -$0.49 for Q3 compared to $2.87 per share for the prior-year quarter.

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 57.4%, 1,020 basis points worse than the prior-year quarter. Operating margin was 19.6%, 13,650 basis points worse than the prior-year quarter. Net margin was -28.0%, 17,630 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $92.2 million. On the bottom line, the average EPS estimate is $0.44.

Next year's average estimate for revenue is $339.5 million. The average EPS estimate is $1.92.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 277 members out of 285 rating the stock outperform, and eight members rating it underperform. Among 93 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 92 give Legacy Reserves Lp a green thumbs-up, and one give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Legacy Reserves Lp is buy, with an average price target of $31.38.

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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. The Motley Fool has no positions in the stocks mentioned above. 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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