The 10-second takeaway
For the quarter ended June 30 (Q2), Ancestry.com beat slightly on revenue and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue improved significantly and GAAP earnings per share expanded significantly.
Gross margins dropped, operating margins dropped, and net margins increased.
Ancestry.com logged revenue of $119.1 million. The six analysts polled by S&P Capital IQ predicted sales of $117.3 million on the same basis. GAAP reported sales were 18% higher than the prior-year quarter's $101.3 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 $0.44. The seven earnings estimates compiled by S&P Capital IQ anticipated $0.46 per share. GAAP EPS of $0.44 for Q2 were 33% higher than the prior-year quarter's $0.33 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 83.2%, 110 basis points worse than the prior-year quarter. Operating margin was 24.7%, 140 basis points worse than the prior-year quarter. Net margin was 16.8%, 50 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $119.3 million. On the bottom line, the average EPS estimate is $0.48.
Next year's average estimate for revenue is $466.2 million. The average EPS estimate is $1.80.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 359 members out of 399 rating the stock outperform, and 40 members rating it underperform. Among 106 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 95 give Ancestry.com a green thumbs-up, and 11 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Ancestry.com is outperform, with an average price target of $36.56.
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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. The Motley Fool owns shares of Ancestry.com. Motley Fool newsletter services have recommended buying shares of Ancestry.com. 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.