Level 3 Communications
The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Level 3 Communications missed estimates on revenue and met expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP loss per share increased.
Gross margins shrank, operating margins improved, and net margins shrank.
Level 3 Communications reported revenue of $1.58 billion. The 10 analysts polled by S&P Capital IQ expected a top line of $1.64 billion. GAAP sales were 71% higher than the prior-year quarter's $921.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at -$1.02. The 12 earnings estimates compiled by S&P Capital IQ predicted -$1.02 per share on the same basis. GAAP EPS were -$0.80 for Q4 versus -$0.47 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 58.2%, 220 basis points worse than the prior-year quarter. Operating margin was 2.8%, 380 basis points better than the prior-year quarter. Net margin was -10.3%, 470 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.64 billion. On the bottom line, the average EPS estimate is -$0.96.
Next year's average estimate for revenue is $6.70 billion. The average EPS estimate is -$3.26.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,858 members out of 1,985 rating the stock outperform, and 127 members rating it underperform. Among 259 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 235 give Level 3 Communications a green thumbs-up, and 24 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Level 3 Communications is hold, with an average price target of $30.43.
New mobile devices and services are changing the game and potential profitability in the telecom industry. Some will fail, some will tread water, and those providing the right services and the right devices will shine. Where does Level 3 Communications fit in? Who will lead going forward? Check out our free report: "3 Hidden Winners of the iPhone, iPad, and Android Revolution." Click here for instant access to this free report.
- Add Level 3 Communications to My Watchlist.