Lender Processing Services
The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Lender Processing Services beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly and GAAP earnings per share contracted to a loss.
Gross margins improved, operating margins dropped, net margins contracted.
Lender Processing Services booked revenue of $532.1 million. The nine analysts polled by S&P Capital IQ anticipated a top line of $511.2 million on the same basis. GAAP reported sales were 16% lower than the prior-year quarter's $638.8 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 $0.59. The nine earnings estimates compiled by S&P Capital IQ predicted $0.53 per share on the same basis. GAAP EPS were -$0.25 for Q3 against $0.78 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 32.5%, 110 basis points better than the prior-year quarter. Operating margin was 0.9%, 1,990 basis points worse than the prior-year quarter. Net margin was -4.0%, 1,510 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $516.9 million. On the bottom line, the average EPS estimate is $0.58.
Next year's average estimate for revenue is $2.12 billion. The average EPS estimate is $2.55.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 99 members out of 124 rating the stock outperform, and 25 members rating it underperform. Among 32 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 27 give Lender Processing Services a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Lender Processing Services is hold, with an average price target of $20.00.
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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. The Motley Fool has sold shares of Lender Processing Services short. 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.