The 10-second takeaway
For the quarter ended Dec. 31 (Q3), Compuware missed on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue increased slightly, and earnings per share dropped significantly.
Margins contracted across the board.
Compuware logged revenue of $253.1 million. The five analysts polled by S&P Capital IQ hoped for sales of $258.8 million. Sales were 2.4% higher than the prior-year quarter's $247.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
EPS came in at $0.10. The six earnings estimates compiled by S&P Capital IQ averaged $0.12 per share. GAAP EPS of $0.10 for Q3 were 33% lower than the prior-year quarter's $0.15 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 66.7%, 380 basis points worse than the prior-year quarter. Operating margin was 12.9%, 710 basis points worse than the prior-year quarter. Net margin was 8.5%, 530 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $274.8 million. On the bottom line, the average EPS estimate is $0.13.
Next year's average estimate for revenue is $1.03 billion. The average EPS estimate is $0.46.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 146 members out of 175 rating the stock outperform, and 29 members rating it underperform. Among 51 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 45 give Compuware 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 Compuware is outperform, with an average price target of $12.25.
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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. 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.