Vanguard Natural Resources Goes Negative

Vanguard Natural Resources (NYSE: VNR  ) reported earnings on Nov. 1. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Vanguard Natural Resources whiffed on revenues and missed estimates on earnings per share.

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

Margins contracted across the board.

Revenue details
Vanguard Natural Resources booked revenue of $78.9 million. The eight analysts polled by S&P Capital IQ predicted a top line of $100.3 million on the same basis. GAAP reported sales were 6.0% higher than the prior-year quarter's $74.4 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 $0.34. The 10 earnings estimates compiled by S&P Capital IQ predicted $0.39 per share. GAAP EPS were -$1.29 for Q3 compared to $2.50 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 66.3%, 270 basis points worse than the prior-year quarter. Operating margin was -67.8%, 25,070 basis points worse than the prior-year quarter. Net margin was -87.1%, 18,910 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $103.3 million. On the bottom line, the average EPS estimate is $0.40.

Next year's average estimate for revenue is $374.9 million. The average EPS estimate is $1.56.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 259 members out of 273 rating the stock outperform, and 14 members rating it underperform. Among 68 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 66 give Vanguard Natural Resources a green thumbs-up, and two give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Vanguard Natural Resources is outperform, with an average price target of $31.94.

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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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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 08, 2012, at 7:44 PM, surfgeezer wrote:

    C'mon, why are you using earnings? INFORM your readers, you should explain WHY that is a terrible metric to look at for any "flow thru" investment like an MLP. Use FFO or even better-Adjusted Funds From Operations.

    VNR is complicated by heding and aquisitions, you do your readers no favors by making it easy on yourself and using earnings.

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