The 10-second takeaway
For the quarter ended March 31 (Q1), Masimo met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue improved and GAAP earnings per share contracted.
Margins contracted across the board.
Masimo chalked up revenue of $119.2 million. The 11 analysts polled by S&P Capital IQ wanted to see revenue of $118.5 million on the same basis. GAAP reported sales were 5.5% higher than the prior-year quarter's $113.0 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 $0.27. The 11 earnings estimates compiled by S&P Capital IQ averaged $0.28 per share. GAAP EPS of $0.27 for Q1 were 10.0% lower than the prior-year quarter's $0.30 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 66.5%, 150 basis points worse than the prior-year quarter. Operating margin was 18.7%, 380 basis points worse than the prior-year quarter. Net margin was 13.2%, 270 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $120.4 million. On the bottom line, the average EPS estimate is $0.28.
Next year's average estimate for revenue is $484.8 million. The average EPS estimate is $1.15.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 165 members out of 173 rating the stock outperform, and eight members rating it underperform. Among 33 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 32 give Masimo a green thumbs-up, and one gives it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Masimo is hold, with an average price target of $24.44.
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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. The Motley Fool owns shares of Masimo. 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.