The 10-second takeaway
For the quarter ended March 31 (Q1), ZAGG beat expectations on revenues and earnings per share.
Compared to the prior-year quarter, revenue improved significantly and GAAP earnings per share improved significantly.
Gross margins shrank, operating margins improved, and net margins dropped.
ZAGG booked revenue of $55.5 million. The four analysts polled by S&P Capital IQ predicted a top line of $51.1 million on the same basis. GAAP reported sales were much higher than the prior-year quarter's $27.0 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 $0.16. The two earnings estimates compiled by S&P Capital IQ predicted $0.15 per share. GAAP EPS of $0.16 for Q1 were 23% higher than the prior-year quarter's $0.13 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 48.5%, 210 basis points worse than the prior-year quarter. Operating margin was 18.4%, 40 basis points better than the prior-year quarter. Net margin was 9.2%, 310 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $55.5 million. On the bottom line, the average EPS estimate is $0.18.
Next year's average estimate for revenue is $252.8 million. The average EPS estimate is $0.87.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 249 members out of 393 rating the stock outperform, and 144 members rating it underperform. Among 98 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 24 give ZAGG a green thumbs-up, and 74 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on ZAGG is buy, with an average price target of $17.31.
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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. Motley Fool newsletter services have recommended writing naked calls on ZAGG. 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.