The 10-second takeaway
For the quarter ended Dec. 31 (Q4), TransAlta beat expectations on revenues and whiffed on earnings per share.
Compared to the prior-year quarter, revenue shrank significantly and GAAP earnings per share dropped significantly.
Margins dropped across the board.
TransAlta tallied revenue of $689.6 million. The three analysts polled by S&P Capital IQ anticipated a top line of $652.3 million on the same basis. GAAP reported sales were 15% lower than the prior-year quarter's $815.4 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 $0.13. The one earnings estimate compiled by S&P Capital IQ predicted $0.20 per share on the same basis. GAAP EPS of $0.11 for Q4 were 61% lower than the prior-year quarter's $0.28 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 37.7%, 260 basis points worse than the prior-year quarter. Operating margin was 17.8%, 810 basis points worse than the prior-year quarter. Net margin was 4%, 380 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $673.1 million. On the bottom line, the average EPS estimate is $0.31.
Next year's average estimate for revenue is $2.67 billion. The average EPS estimate is $1.09.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 67 members rating the stock outperform and five members rating it underperform. Among 20 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 18 give TransAlta a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on TransAlta is hold, with an average price target of $23.47.
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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.