The 10-second takeaway
For the quarter ended Dec. 31 (Q4), RadiSys beat slightly on revenues and exceeded expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP loss per share improved.
Gross margins improved, operating margins shrank, and net margins dropped.
RadiSys chalked up revenue of $79.5 million. The three analysts polled by S&P Capital IQ foresaw sales of $78.4 million. Sales were 19% higher than the prior-year quarter's $66.8 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.05. The three earnings estimates compiled by S&P Capital IQ anticipated $0 per share on the same basis. GAAP EPS were -$0.25 for Q4 versus -$0.09 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 34.6%, 20 basis points better than the prior-year quarter. Operating margin was -6.0%, 700 basis points worse than the prior-year quarter. Net margin was -8.4%, 530 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $76.8 million. On the bottom line, the average EPS estimate is $0.04.
Next year's average estimate for revenue is $339.0 million. The average EPS estimate is $0.74.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 93 members out of 102 rating the stock outperform, and nine members rating it underperform. Among 36 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 34 give RadiSys 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 RadiSys is buy, with an average price target of $9.75.
Over the decades, small-cap stocks like RadiSys have produced market-beating returns, provided they're value-priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: 2 Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add RadiSys to My Watchlist.
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.