The 10-second takeaway
For the quarter ended June 30 (Q1), Forest Laboratories met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue contracted significantly and GAAP earnings per share contracted significantly.
Gross margins expanded, operating margins shrank, net margins dropped.
Forest Laboratories recorded revenue of $821.1 million. The 22 analysts polled by S&P Capital IQ expected sales of $817.0 million on the same basis. GAAP reported sales were 28% lower than the prior-year quarter's $1.15 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 $0.21. The 19 earnings estimates compiled by S&P Capital IQ forecast $0.24 per share. GAAP EPS of $0.21 for Q1 were 77% lower than the prior-year quarter's $0.90 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 79.5%, 160 basis points better than the prior-year quarter. Operating margin was 9.2%, 2,050 basis points worse than the prior-year quarter. Net margin was 6.7%, 1,580 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $789.2 million. On the bottom line, the average EPS estimate is $0.05.
Next year's average estimate for revenue is $3.26 billion. The average EPS estimate is $0.73.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Forest Laboratories is hold, with an average price target of $36.41.
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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.