The 10-second takeaway
For the quarter ended March 31 (Q1), SAP missed estimates on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded. Non-GAAP earnings per share expanded significantly. GAAP earnings per share grew.
Gross margins contracted, operating margins shrank, net margins increased.
SAP booked revenue of $4.66 billion. The 21 analysts polled by S&P Capital IQ predicted revenue of $4.86 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.
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 $0.75. The 11 earnings estimates compiled by S&P Capital IQ averaged $0.76 per share. Non-GAAP EPS of $0.75 for Q1 were 15% higher than the prior-year quarter's $0.65 per share. GAAP EPS of $0.56 for Q1 were 14% higher than the prior-year quarter's $0.49 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 66.4%, 100 basis points worse than the prior-year quarter. Operating margin was 18.3%, 390 basis points worse than the prior-year quarter. Net margin was 14.4%, 110 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $5.54 billion. On the bottom line, the average EPS estimate is $1.01.
Next year's average estimate for revenue is $23.28 billion. The average EPS estimate is $4.51.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 347 members out of 396 rating the stock outperform, and 49 members rating it underperform. Among 108 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 93 give SAP a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on SAP is hold, with an average price target of $79.03.
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