The 10-second takeaway
For the quarter ended June 30 (Q2), Generac Holdings beat expectations on revenues and earnings per share.
Compared to the prior-year quarter, revenue improved significantly and GAAP earnings per share dropped significantly.
Gross margins contracted, operating margins improved, and net margins dropped.
Generac Holdings reported revenue of $239.1 million. The eight analysts polled by S&P Capital IQ predicted net sales of $229.6 million on the same basis. GAAP reported sales were 48% higher than the prior-year quarter's $161.4 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 $0.58. The nine earnings estimates compiled by S&P Capital IQ forecast $0.53 per share. GAAP EPS of $0.14 for Q2 were 39% lower than the prior-year quarter's $0.23 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 36.6%, 80 basis points worse than the prior-year quarter. Operating margin was 15.5%, 200 basis points better than the prior-year quarter. Net margin was 3.9%, 560 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $235.5 million. On the bottom line, the average EPS estimate is $0.42.
Next year's average estimate for revenue is $986.6 million. The average EPS estimate is $2.22.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 45 members out of 50 rating the stock outperform, and five members rating it underperform. Among nine CAPS All-Star picks (recommendations by the highest-ranked CAPS members), nine give Generac Holdings a green thumbs-up.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Generac Holdings is hold, with an average price target of $26.50.
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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 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 may not 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.