The 10-second takeaway
For the quarter ended March 24 (Q1), Safeway met expectations on revenues and met expectations on earnings per share.
Compared with the prior-year quarter, revenue expanded slightly and GAAP earnings per share grew significantly.
Gross margins contracted, operating margins shrank, net margins increased.
Safeway chalked up revenue of $10.00 billion. The 16 analysts polled by S&P Capital IQ foresaw revenue of $10.06 billion on the same basis. GAAP reported sales were 2.4% higher than the prior-year quarter's $9.77 billion.
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 $0.30. The 18 earnings estimates compiled by S&P Capital IQ averaged $0.30 per share. GAAP EPS of $0.27 for Q1 were 286% 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 26.8%, 70 basis points worse than the prior-year quarter. Operating margin was 1.9%, 40 basis points worse than the prior-year quarter. Net margin was 0.7%, 40 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $10.43 billion. On the bottom line, the average EPS estimate is $0.47.
Next year's average estimate for revenue is $44.58 billion. The average EPS estimate is $1.96.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 326 members out of 393 rating the stock outperform, and 67 members rating it underperform. Among 107 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 91 give Safeway a green thumbs-up, and 16 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Safeway is hold, with an average price target of $21.18.
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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. He is the 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 don't 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.