The 10-second takeaway
For the quarter ended June 30 (Q2), Neutral Tandem missed estimates on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share dropped significantly.
Margins dropped across the board.
Neutral Tandem logged revenue of $68.3 million. The seven analysts polled by S&P Capital IQ expected to see net sales of $72.3 million on the same basis. GAAP reported sales were 4.9% higher than the prior-year quarter's $65.1 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 $0.12. The seven earnings estimates compiled by S&P Capital IQ predicted $0.19 per share. GAAP EPS of $0.12 for Q2 were 40% lower than the prior-year quarter's $0.20 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 39.3%, 600 basis points worse than the prior-year quarter. Operating margin was 12.2%, 720 basis points worse than the prior-year quarter. Net margin was 5.4%, 540 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $72.9 million. On the bottom line, the average EPS estimate is $0.19.
Next year's average estimate for revenue is $287.2 million. The average EPS estimate is $0.78.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 888 members out of 911 rating the stock outperform, and 23 members rating it underperform. Among 214 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 210 give Neutral Tandem a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Neutral Tandem is outperform, with an average price target of $15.20.
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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 owns shares of Inteliquent. 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.