The 10-second takeaway
For the quarter ended March 31 (Q1), Deluxe beat expectations on revenues and beat expectations on earnings per share.
Compared with the prior-year quarter, revenue expanded and GAAP earnings per share expanded significantly.
Margins improved across the board.
Deluxe recorded revenue of $378.0 million. The four analysts polled by S&P Capital IQ looked for a top line of $359.4 million on the same basis. GAAP reported sales were 8.1% higher than the prior-year quarter's $349.8 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 $0.88. The four earnings estimates compiled by S&P Capital IQ forecast $0.80 per share. GAAP EPS of $0.86 for Q1 were 37% higher than the prior-year quarter's $0.63 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 66.3%, 60 basis points better than the prior-year quarter. Operating margin was 20.8%, 110 basis points better than the prior-year quarter. Net margin was 11.7%, 240 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $354.7 million. On the bottom line, the average EPS estimate is $0.78.
Next year's average estimate for revenue is $1.44 billion. The average EPS estimate is $3.22.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 188 members out of 209 rating the stock outperform, and 21 members rating it underperform. Among 60 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 51 give Deluxe a green thumbs-up, and nine give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Deluxe is outperform, with an average price target of $32.00.
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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.