RPM International Beats on Both Top and Bottom Lines

Just the facts, Fool.

Seth Jayson
Seth Jayson
Apr 9, 2012 at 12:00AM
Other

RPM International (NYSE: RPM) reported earnings on April 5. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 29 (Q3), RPM International beat expectations on revenue and beat expectations on earnings per share.

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

Gross margin dropped, operating margin improved, and net margin increased.

Revenue details
RPM International tallied revenue of $773.6 million. The five analysts polled by S&P Capital IQ looked for net sales of $733.4 million on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $678.9 million.

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

EPS details
EPS came in at $0.05. The seven earnings estimates compiled by S&P Capital IQ predicted $0.02 per share. GAAP EPS of $0.05 for Q3 were 400% higher than the prior-year quarter's $0.01 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 39.2%, 50 basis points worse than the prior-year quarter. Operating margin was 3.3%, 140 basis points better than the prior-year quarter. Net margin was 0.9%, 70 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $1.08 billion. On the bottom line, the average EPS estimate is $0.61.

Next year's average estimate for revenue is $3.75 billion. The average EPS estimate is $1.63.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 342 members out of 367 rating the stock outperform, and 25 members rating it underperform. Among 83 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 81 give RPM International 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 RPM International is hold, with an average price target of $26.25.

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