The 10-second takeaway
For the quarter ended March 31 (Q1), Quad/Graphics beat slightly on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share dropped significantly. GAAP earnings per share dropped to a loss.
Margins contracted across the board.
Quad/Graphics recorded revenue of $1.13 billion. The two analysts polled by S&P Capital IQ expected to see sales of $1.12 billion on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $989.6 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 $0.05. The two earnings estimates compiled by S&P Capital IQ anticipated $0.15 per share. Non-GAAP EPS of $0.05 for Q1 were 96% lower than the prior-year quarter's $1.14 per share. (The prior-year quarter included $0.68 per share in earnings from discontinued operations.) GAAP EPS were -$0.31 for Q1 compared to $1.01 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 19.5%, 240 basis points worse than the prior-year quarter. Operating margin was 2.2%, 190 basis points worse than the prior-year quarter. Net margin was -1.2%, 600 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.09 billion. On the bottom line, the average EPS estimate is -$0.02.
Next year's average estimate for revenue is $4.90 billion. The average EPS estimate is $2.06.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 16 members out of 34 rating the stock outperform, and 18 members rating it underperform. Among 12 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), five give Quad/Graphics 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 Quad/Graphics is outperform, with an average price target of $24.50.
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