The 10-second takeaway
For the quarter ended Dec. 31 (Q2), ResMed met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew, and GAAP earnings per share dropped.
Margins dropped across the board.
ResMed reported revenue of $332.7 million. The 11 analysts polled by S&P Capital IQ predicted revenue of $336.5 million. Sales were 8.7% higher than the prior-year quarter's $306.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.44. The nine earnings estimates compiled by S&P Capital IQ predicted $0.38 per share on the same basis. GAAP EPS of $0.33 for Q2 were 14% higher than the prior-year quarter's $0.37 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 59.7%, 110 basis points worse than the prior-year quarter. Operating margin was 20.2%, 260 basis points worse than the prior-year quarter. Net margin was 18.9%, 20 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $340.0 million. On the bottom line, the average EPS estimate is $0.42.
Next year's average estimate for revenue is $1.36 billion. The average EPS estimate is $1.65.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 171 members out of 184 rating the stock outperform, and 13 members rating it underperform. Among 63 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 61 give ResMed a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on ResMed is outperform, with an average price target of $31.49.
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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 don't 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.