The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Netspend Holdings met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue improved and GAAP earnings per share improved significantly.
Margins improved across the board.
Netspend Holdings logged revenue of $76.8 million. The 15 analysts polled by S&P Capital IQ foresaw a top line of $77.5 million on the same basis. GAAP reported sales were 9.3% higher than the prior-year quarter's $70.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.11. The eight earnings estimates compiled by S&P Capital IQ averaged $0.10 per share. GAAP EPS of $0.11 for Q4 were 57% higher than the prior-year quarter's $0.07 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 37.1%, 790 basis points better than the prior-year quarter. Operating margin was 22.1%, 870 basis points better than the prior-year quarter. Net margin was 12.5%, 350 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $87.6 million. On the bottom line, the average EPS estimate is $0.12.
Next year's average estimate for revenue is $341.2 million. The average EPS estimate is $0.45.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 28 members out of 28 rating the stock outperform. Among 13 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 13 give Netspend Holdings a green thumbs-up.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Netspend Holdings is outperform, with an average price target of $8.06.
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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. 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.