Watson Pharmaceuticals (NYSE: WPI) reported earnings on Feb. 14. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Watson Pharmaceuticals met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share grew significantly.

Gross margins dropped, operating margins expanded, and net margins improved.

Revenue details
Watson Pharmaceuticals recorded revenue of $1.54 billion. The 17 analysts polled by S&P Capital IQ expected to see a top line of $1.54 billion on the same basis. GAAP reported sales were 62% higher than the prior-year quarter's $952.7 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $1.77. The 21 earnings estimates compiled by S&P Capital IQ forecast $1.75 per share on the same basis. GAAP EPS of $0.75 for Q4 were 436% higher than the prior-year quarter's $0.14 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 42.2%, 380 basis points worse than the prior-year quarter. Operating margin was 14.3%, 550 basis points better than the prior-year quarter. Net margin was 6.1%, 420 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $1.45 billion. On the bottom line, the average EPS estimate is $1.57.

Next year's average estimate for revenue is $5.38 billion. The average EPS estimate is $5.59.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 177 members out of 199 rating the stock outperform, and 22 members rating it underperform. Among 79 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 74 give Watson Pharmaceuticals 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 Watson Pharmaceuticals is outperform, with an average price target of $76.11.

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