The 10-second takeaway
For the quarter ended June 30 (Q2), Federal Signal missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share dropped to a loss.
Gross margins contracted, operating margins increased, net margins shrank.
Federal Signal reported revenue of $204.4 million. The two analysts polled by S&P Capital IQ predicted revenue of $210.9 million on the same basis.
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 $0.15. The three earnings estimates compiled by S&P Capital IQ forecast $0.11 per share. GAAP EPS were -$0.27 for Q2 compared to $0.09 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 24.1%, 120 basis points worse than the prior-year quarter. Operating margin was 7.7%, 330 basis points better than the prior-year quarter. Net margin was -8.1%, 1,100 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $186.8 million. On the bottom line, the average EPS estimate is $0.07.
Next year's average estimate for revenue is $847.9 million. The average EPS estimate is $0.33.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 67 members out of 80 rating the stock outperform, and 13 members rating it underperform. Among 19 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 17 give Federal Signal 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 Federal Signal is hold, with an average price target of $5.50.
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