The 10-second takeaway
For the quarter ended March 31 (Q1), Transocean missed estimates on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share dropped significantly.
Gross margins expanded, operating margins expanded, and net margins dropped.
Transocean booked revenue of $2.33 billion. The 20 analysts polled by S&P Capital IQ expected to see revenue of $2.39 billion on the same basis. GAAP reported sales were 8.7% higher than the prior-year quarter's $2.14 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 $0.64. The 25 earnings estimates compiled by S&P Capital IQ averaged $0.34 per share. GAAP EPS of $0.12 for Q1 were 88% lower than the prior-year quarter's $0.97 per share. (The prior-year quarter included $0.55 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 39.5%, 290 basis points better than the prior-year quarter. Operating margin was 21.5%, 450 basis points better than the prior-year quarter. Net margin was 1.8%, 1,270 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.55 billion. On the bottom line, the average EPS estimate is $0.62.
Next year's average estimate for revenue is $10.24 billion. The average EPS estimate is $2.92.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Transocean is outperform, with an average price target of $65.85.
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Seth Jayson owned shares of the following at the time of publication: Transocean. 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 Transocean. 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.