The 10-second takeaway
For the quarter ended June 30 (Q2), WebMD Health met expectations on revenues and earnings per share.
Compared to the prior-year quarter, revenue shrank significantly, and GAAP earnings per share shrank to a loss.
Margins dropped across the board.
WebMD Health notched revenue of $112.7 million. The four analysts polled by S&P Capital IQ hoped for a top line of $112.1 million on the same basis. GAAP reported sales were 20% lower than the prior-year quarter's $141.4 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 -$0.12. The two earnings estimates compiled by S&P Capital IQ predicted -$0.12 per share. GAAP EPS were -$0.11 for Q2 versus $0.35 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 51.9%, 1,190 basis points worse than the prior-year quarter. Operating margin was -1.6%, 2,230 basis points worse than the prior-year quarter. Net margin was -5.0%, 2,030 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $115.1 million. On the bottom line, the average EPS estimate is -$0.11.
Next year's average estimate for revenue is $461.9 million. The average EPS estimate is -$0.37.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 111 members out of 167 rating the stock outperform, and 56 members rating it underperform. Among 47 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 28 give WebMD Health a green thumbs-up, and 19 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on WebMD Health is hold, with an average price target of $23.50.
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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. 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.