The 10-second takeaway
For the quarter ended April 28 (Q3), Dycom Industries beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share expanded significantly.
Margins improved across the board.
Dycom Industries tallied revenue of $296.1 million. The seven analysts polled by S&P Capital IQ wanted to see a top line of $283.3 million on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $252.4 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 $0.28. The seven earnings estimates compiled by S&P Capital IQ anticipated $0.21 per share. GAAP EPS of $0.28 for Q3 were much higher than the prior-year quarter's $0.04 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 18.5%, 30 basis points better than the prior-year quarter. Operating margin was 4.1%, 140 basis points better than the prior-year quarter. Net margin was 3.3%, 270 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $327.0 million. On the bottom line, the average EPS estimate is $0.41.
Next year's average estimate for revenue is $1.20 billion. The average EPS estimate is $1.11.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 115 members out of 122 rating the stock outperform, and seven members rating it underperform. Among 35 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 33 give Dycom Industries a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Dycom Industries is outperform, with an average price target of $28.17.
Over the decades, small-cap stocks, like Dycom Industries have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add Dycom Industries to My Watchlist.
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.