Geospace Technologies Increases Sales but Misses Estimates on Earnings

Geospace Technologies (Nasdaq: GEOS  ) reported earnings on Dec. 11. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Sep. 30 (Q4), Geospace Technologies whiffed on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue grew and GAAP earnings per share increased significantly.

Gross margins dropped, operating margins dropped, net margins grew.

Revenue details
Geospace Technologies chalked up revenue of $36.9 million. The seven analysts polled by S&P Capital IQ predicted revenue of $46.5 million on the same basis. GAAP reported sales were 13% higher than the prior-year quarter's $32.8 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 $0.33. The five earnings estimates compiled by S&P Capital IQ averaged $0.67 per share. GAAP EPS of $0.33 for Q4 were 18% higher than the prior-year quarter's $0.28 per share.

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 36.1%, 290 basis points worse than the prior-year quarter. Operating margin was 16.7%, 180 basis points worse than the prior-year quarter. Net margin was 11.5%, 60 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $75.5 million. On the bottom line, the average EPS estimate is $1.19.

Next year's average estimate for revenue is $304.2 million. The average EPS estimate is $5.52.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,214 members out of 1,242 rating the stock outperform, and 28 members rating it underperform. Among 460 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 453 give Geospace Technologies a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Geospace Technologies is outperform, with an average price target of $76.40.

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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. Motley Fool newsletter services recommend Geospace Technologies. 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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  • Report this Comment On December 12, 2012, at 4:15 PM, hanover67 wrote:

    Both sales and EPS were lower than estimates, EPS in a big way. This is the kind of " surprise" I hate. Management says their revenues are "lumpy" and indicated some major contracts that will come to fruition next year, but nobody likes a hit to the stock price, especially in a choppy market.

    I'm hanging on besause I beieve in the business and the oil and gas industry is due for continued growth in earnings.

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