The 10-second takeaway
For the quarter ended March 31 (Q1), Avon Products beat expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share dropped significantly.
Margins dropped across the board.
Avon Products booked revenue of $2.58 billion. The 11 analysts polled by S&P Capital IQ expected to see sales of $2.52 billion on the same basis. GAAP reported sales were 2.0% lower than the prior-year quarter's $2.63 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 $0.10. The 15 earnings estimates compiled by S&P Capital IQ predicted $0.28 per share. GAAP EPS of $0.06 for Q1 were 82% lower than the prior-year quarter's $0.33 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 60.8%, 310 basis points worse than the prior-year quarter. Operating margin was 2.8%, 710 basis points worse than the prior-year quarter. Net margin was 1.0%, 450 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.73 billion. On the bottom line, the average EPS estimate is $0.38.
Next year's average estimate for revenue is $11.18 billion. The average EPS estimate is $1.49.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 363 members out of 415 rating the stock outperform, and 52 members rating it underperform. Among 105 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 93 give Avon Products a green thumbs-up, and 12 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Avon Products is hold, with an average price target of $21.62.
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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.