The 10-second takeaway
For the quarter ended April 28 (Q1), Limited Brands beat slightly on revenue and met expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank slightly and GAAP earnings per share dropped significantly.
Gross margin and operating margin improved, while net margin contracted.
Limited Brands booked revenue of $2.15 billion. The 12 analysts polled by S&P Capital IQ predicted a top line of $2.13 billion on the same basis. GAAP-reported sales were 2.9% lower than the prior-year quarter's $2.22 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 $0.41. The 22 earnings estimates compiled by S&P Capital IQ forecast $0.41 per share. GAAP EPS of $0.41 for Q1 were 18% lower than the prior-year quarter's $0.50 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 41.9%, 390 basis points better than the prior-year quarter. Operating margin was 13.6%, 380 basis points better than the prior-year quarter. Net margin was 5.8%, 160 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.36 billion. On the bottom line, the average EPS estimate is $0.45.
Next year's average estimate for revenue is $10.33 billion. The average EPS estimate is $2.82.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 562 members rating the stock outperform and 100 members rating it underperform. Among 212 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 190 give Limited Brands a green thumbs-up, and 22 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Limited Brands is outperform, with an average price target of $49.35.
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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.