The 10-second takeaway
For the quarter ended March 31 (Q1), Epocrates beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted and GAAP loss per share dropped.
Gross margins shrank, operating margins grew, net margins dropped.
Epocrates reported revenue of $27.5 million. The five analysts polled by S&P Capital IQ looked for revenue of $26.6 million on the same basis. GAAP reported sales were 5.6% lower than the prior-year quarter's $29.2 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 $0.09. The five earnings estimates compiled by S&P Capital IQ forecast $0.01 per share. GAAP EPS were -$0.06 for Q1 against -$0.08 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 62.6%, 520 basis points worse than the prior-year quarter. Operating margin was 4.6%, 850 basis points better than the prior-year quarter. Net margin was -5.2%, 130 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $26.0 million. On the bottom line, the average EPS estimate is -$0.01.
Next year's average estimate for revenue is $108.8 million. The average EPS estimate is $0.17.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 34 members out of 39 rating the stock outperform, and five members rating it underperform. Among 10 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), eight give Epocrates 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 Epocrates is hold, with an average price target of $12.00.
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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 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.