The 10-second takeaway
For the quarter ended April 30 (Q1), Mentor Graphics missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share improved.
Gross margins dropped, operating margins increased, net margins improved.
Mentor Graphics logged revenue of $247.9 million. The seven analysts polled by S&P Capital IQ looked for sales of $254.9 million on the same basis. GAAP reported sales were 7.8% higher than the prior-year quarter's $230.0 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 $0.30. The seven earnings estimates compiled by S&P Capital IQ averaged $0.24 per share. GAAP EPS were $0.25 for Q1 compared to -$0.02 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 82.6%, 120 basis points worse than the prior-year quarter. Operating margin was 13.5%, 490 basis points better than the prior-year quarter. Net margin was 11.4%, 1,240 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $238.2 million. On the bottom line, the average EPS estimate is $0.15.
Next year's average estimate for revenue is $1.10 billion. The average EPS estimate is $1.32.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 387 members out of 399 rating the stock outperform, and 13 members rating it underperform. Among 75 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 72 give Mentor Graphics a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Mentor Graphics is buy, with an average price target of $18.92.
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