Investors braced for a bumpy ride ahead of Air Methods' (Nasdaq: AIRM) earnings announcement as the company has wavered between beating and falling short of analyst predictions during the past fiscal year. The company will unveil its latest earnings Thursday. Air Methods provides air medical emergency transport services and systems throughout the U.S. It also designs, manufactures, and installs medical aircraft interiors and other aerospace and medical transport products.
What analysts say:
- Buy, sell, or hold?: The majority of analysts back Air Methods as a buy. But with 71.4% of analysts rating it a buy, Air Methods is still below the mean analyst rating of its nearest 10 competitors, which average 72.7% buys. Analysts like Air Methods better than competitor Continucare overall. One out of two analysts rate Continucare a buy compared with five of seven for Air Methods. That rating hasn't budged in three months as analysts have remained steady in their opinion of the stock.
- Revenue Forecasts: On average, analysts predict $146.9 million in revenue this quarter. That would represent a rise of 5.5% from the year-ago quarter.
- Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.76 per share. Estimates range from $0.75 to $0.78.
What our community says:
CAPS All-Stars are solidly behind the stock with 95% granting it an "outperform" rating. The community at large concurs with the All-Stars with 91.6% giving it a rating of "outperform." Fools are keen on Air Methods, though the message boards have been quiet lately with only 58 posts in the past 30 days. Despite the majority sentiment in favor of Air Methods, the stock has a middling CAPS rating of three out of five stars.
Management:
Revenue has now gone up for three straight quarters. The company increased its gross margin by 7.6 percentage points in the last quarter. Revenue rose 11.3% while cost of sales rose 0.8% to $96.2 million from a year earlier.
Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.
|
Quarter |
Q1 |
Q4 |
Q3 |
Q2 |
|
Gross Margin |
27% |
31.9% |
34.3% |
32.8% |
|
Operating Margin |
8.1% |
14.9% |
19.0% |
16.2% |
|
Net Margin |
4.5% |
8.4% |
12.1% |
9.2% |
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