The 10-second takeaway
For the quarter ended March 31 (Q1), SM Energy beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly. Non-GAAP earnings per share grew significantly. GAAP earnings per share dropped significantly.
Gross margins increased, operating margins contracted, net margins shrank.
SM Energy recorded revenue of $484.2 million. The 15 analysts polled by S&P Capital IQ predicted sales of $462.6 million on the same basis. GAAP reported sales were 29% higher than the prior-year quarter's $374.3 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 $0.82. The 25 earnings estimates compiled by S&P Capital IQ predicted $0.58 per share. Non-GAAP EPS of $0.82 for Q1 were 71% higher than the prior-year quarter's $0.48 per share. GAAP EPS of $0.25 for Q1 were 36% lower than the prior-year quarter's $0.39 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 74.1%, 40 basis points better than the prior-year quarter. Operating margin was 13.6%, 210 basis points worse than the prior-year quarter. Net margin was 3.5%, 350 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $493.5 million. On the bottom line, the average EPS estimate is $0.65.
Next year's average estimate for revenue is $2.04 billion. The average EPS estimate is $2.88.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 281 members out of 298 rating the stock outperform, and 17 members rating it underperform. Among 55 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 49 give SM Energy a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on SM Energy is outperform, with an average price target of $74.12.
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