The 10-second takeaway
For the quarter ended June 30 (Q2), Federated Investors missed estimates on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue improved slightly and GAAP earnings per share dropped.
Gross margins expanded, operating margins contracted, net margins dropped.
Federated Investors logged revenue of $232.1 million. The eight analysts polled by S&P Capital IQ anticipated sales of $241.2 million on the same basis. GAAP reported sales were 2.8% higher than the prior-year quarter's $225.8 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 $0.39. The nine earnings estimates compiled by S&P Capital IQ forecast $0.41 per share. GAAP EPS of $0.39 for Q2 were 4.9% lower than the prior-year quarter's $0.41 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 71.9%, 40 basis points better than the prior-year quarter. Operating margin was 29.7%, 220 basis points worse than the prior-year quarter. Net margin was 17.4%, 140 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $245.9 million. On the bottom line, the average EPS estimate is $0.42.
Next year's average estimate for revenue is $960.9 million. The average EPS estimate is $1.67.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 296 members out of 316 rating the stock outperform, and 20 members rating it underperform. Among 92 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 88 give Federated Investors a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Federated Investors is underperform, with an average price target of $20.41.
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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 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 has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Federated Investors. 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.