Editor's note: The original version of this story used third-quarter numbers for revenue and earnings per share. Masimo beat revenue estimates in its fourth quarter, while meeting EPS expectations. The Fool regrets the error.
The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Masimo beat estimates on revenue and met expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share dropped.
Margins contracted across the board.
Masimo recorded revenue of $112.3 million. The 10 analysts polled by S&P Capital IQ looked for revenue of $110.3 million on the same basis.
Non-GAAP EPS came in at $0.23. The 12 earnings estimates compiled by S&P Capital IQ anticipated $0.23 per share on the same basis.
For the quarter, gross margin was 65.5%, 470 basis points worse than the prior-year quarter. Operating margin was 17.9%, 420 basis points worse than the prior-year quarter. Net margin was 12.3%, 300 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $119 million. On the bottom line, the average EPS estimate is $0.29.
Next year's average estimate for revenue is $483 million. The average EPS estimate is $1.17.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 160 members out of 170 rating the stock outperform, and 10 members rating it underperform. Among 36 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 35 give Masimo a green thumbs-up, and one gives it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Masimo is hold, with a mean price target of $24.55.
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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 owns shares of Masimo. 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.