The 10-second takeaway
For the quarter ended March 31 (Q1), Kongzhong beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share improved.
Margins grew across the board.
Kongzhong recorded revenue of $42.5 million. The one analyst polled by S&P Capital IQ hoped for a top line of $41.8 million on the same basis. GAAP reported sales were 8.1% higher than the prior-year quarter's $39.3 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 one earnings estimate compiled by S&P Capital IQ predicted $0.12 per share. GAAP EPS were $0.16 for Q1 versus -$0.01 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 44.2%, 210 basis points better than the prior-year quarter. Operating margin was 14.3%, 120 basis points better than the prior-year quarter. Net margin was 16.2%, 1,740 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $47.6 million. On the bottom line, the average EPS estimate is $0.16.
Next year's average estimate for revenue is $192.6 million. The average EPS estimate is $0.63.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 955 members out of 1,014 rating the stock outperform, and 59 members rating it underperform. Among 234 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 219 give Kongzhong a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Kongzhong is outperform, with an average price target of $7.25.
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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.