The 10-second takeaway
For the quarter ended Nov. 30 (Q4), OMNOVA Solutions beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share shrank to a loss.
Gross margins increased, operating margins grew, and net margins shrank.
OMNOVA Solutions reported revenue of $301.4 million. The two analysts polled by S&P Capital IQ expected net sales of $298.1 million. Sales were 45% higher than the prior-year quarter's $208.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.14. The four earnings estimates compiled by S&P Capital IQ forecast $0.06 per share on the same basis. GAAP EPS were -$0.23 for Q4 versus $1.75 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 18.5%, 180 basis points better than the prior-year quarter. Operating margin was 7.0%, 470 basis points better than the prior-year quarter. Net margin was -3.5%, 4,270 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $262.8 million. On the bottom line, the average EPS estimate is $0.14.
Next year's average estimate for revenue is $1.23 billion. The average EPS estimate is $0.58.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 150 members out of 165 rating the stock outperform, and 15 members rating it underperform. Among 33 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 32 give OMNOVA Solutions a green thumbs-up, and one gives it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on OMNOVA Solutions is buy, with an average price target of $6.85.
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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.