The 10-second takeaway
For the quarter ended Jan. 1 (Q3), Precision Castparts missed on revenues and missed on earnings per share.
Compared to the prior-year quarter, revenue grew and earnings per share increased significantly.
Margins expanded across the board.
Precision Castparts booked revenue of $1.82 billion. The 18 analysts polled by S&P Capital IQ anticipated sales of $1.92 billion. Sales were 14% higher than the prior-year quarter's $1.59 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $2.12. The 22 earnings estimates compiled by S&P Capital IQ predicted $2.21 per share on the same basis. GAAP EPS of $2.11 for Q3 were 18% higher than the prior-year quarter's $1.78 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 31.5%, 80 basis points better than the prior-year quarter. Operating margin was 25.3%, 100 basis points better than the prior-year quarter. Net margin was 16.9%, 80 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $2.04 billion. On the bottom line, the average EPS estimate is $2.39.
Next year's average estimate for revenue is $7.36 billion. The average EPS estimate is $8.60.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,275 members out of 1,305 rating the stock outperform, and 30 members rating it underperform. Among 443 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 439 give Precision Castparts 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 Precision Castparts is outperform, with an average price target of $185.05.
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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. Motley Fool newsletter services have recommended buying shares of Precision Castparts. 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.