The 10-second takeaway
For the quarter ended June 30 (Q2), ABB missed estimates on revenues and earnings per share.
Compared with the prior-year quarter, revenue was unchanged and GAAP earnings per share shrank significantly.
Margins contracted across the board.
ABB tallied revenue of $9.66 billion. The 19 analysts polled by S&P Capital IQ looked for a top line of $9.97 billion on the same basis. GAAP reported sales were 0.2% lower than the prior-year quarter's $9.68 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 $0.33. The five earnings estimates compiled by S&P Capital IQ forecast $0.38 per share. GAAP EPS of $0.29 for Q2 were 26% lower than the prior-year quarter's $0.39 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 29.4%, 180 basis points worse than the prior-year quarter. Operating margin was 10.4%, 340 basis points worse than the prior-year quarter. Net margin was 6.8%, 240 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $10.02 billion. On the bottom line, the average EPS estimate is $0.37.
Next year's average estimate for revenue is $40.33 billion. The average EPS estimate is $1.44.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,777 members out of 1,820 rating the stock outperform, and 43 members rating it underperform. Among 296 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 290 give ABB a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on ABB is outperform, with an average price target of $23.22.
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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 the 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 ABB. Motley Fool newsletter services recommend ABB. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.