The 10-second takeaway
For the quarter ended Sep. 30 (Q3), DST Systems missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share grew significantly.
Gross margins dropped, operating margins contracted, net margins grew.
DST Systems notched revenue of $464.0 million. The five analysts polled by S&P Capital IQ foresaw a top line of $507.1 million on the same basis. GAAP reported sales were 6.9% higher than the prior-year quarter's $591.4 million.
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 $0.96. The five earnings estimates compiled by S&P Capital IQ forecast $0.92 per share. GAAP EPS of $1.87 for Q3 were 146% higher than the prior-year quarter's $0.76 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 14.1%, 210 basis points worse than the prior-year quarter. Operating margin was 8.6%, 190 basis points worse than the prior-year quarter. Net margin was 13.6%, 760 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $517.1 million. On the bottom line, the average EPS estimate is $1.00.
Next year's average estimate for revenue is $2.03 billion. The average EPS estimate is $4.63.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 113 members out of 121 rating the stock outperform, and eight members rating it underperform. Among 39 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 38 give DST Systems 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 DST Systems is hold, with an average price target of $58.40.
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