The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Eastman Chemical beat expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly, and GAAP earnings per share expanded significantly.
Gross margins dropped, operating margins shrank, net margins expanded.
Eastman Chemical recorded revenue of $1.72 billion. The nine analysts polled by S&P Capital IQ expected a top line of $1.63 billion. Sales were 18% higher than the prior-year quarter's $1.46 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.71. The 12 earnings estimates compiled by S&P Capital IQ predicted $0.80 per share on the same basis. GAAP EPS of $1.16 for Q4 were 452% higher than the prior-year quarter's $0.13 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 18.8%, 520 basis points worse than the prior-year quarter. Operating margin was 9.5%, 330 basis points worse than the prior-year quarter. Net margin was 5.8%, 450 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.84 billion. On the bottom line, the average EPS estimate is $1.09.
Next year's average estimate for revenue is $7.51 billion. The average EPS estimate is $4.72.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 177 members out of 203 rating the stock outperform, and 26 members rating it underperform. Among 54 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 50 give Eastman Chemical 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 Eastman Chemical is outperform, with an average price target of $48.09.
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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.