The 10-second takeaway
For the quarter ended June 30 (Q2), TransCanada whiffed on revenue and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly and GAAP earnings per share dropped significantly.
Margins shrank across the board.
TransCanada notched revenue of $1.77 billion. The four analysts polled by S&P Capital IQ expected a top line of $2.07 billion on the same basis. GAAP reported sales were 20% lower than the prior-year quarter's $2.22 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 $0.43. The 12 earnings estimates compiled by S&P Capital IQ predicted $0.47 per share. GAAP EPS of $0.38 for Q2 were 27% lower than the prior-year quarter's $0.52 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 50.5%, 250 basis points worse than the prior-year quarter. Operating margin was 31.3%, 400 basis points worse than the prior-year quarter. Net margin was 15.8%, 130 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.19 billion. On the bottom line, the average EPS estimate is $0.59.
Next year's average estimate for revenue is $8.61 billion. The average EPS estimate is $2.20.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 397 members out of 409 rating the stock outperform, and 12 members rating it underperform. Among 93 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 91 give TransCanada a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on TransCanada is outperform, with an average price target of $44.19.
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