The 10-second takeaway
For the quarter ended Sep. 30 (Q4), F5 Networks met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share grew slightly.
Gross margins increased, operating margins dropped, net margins shrank.
F5 Networks reported revenue of $362.6 million. The 37 analysts polled by S&P Capital IQ predicted revenue of $366.1 million on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $314.6 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 $1.12. The 38 earnings estimates compiled by S&P Capital IQ averaged $1.18 per share. GAAP EPS of $0.85 for Q4 were 2.4% higher than the prior-year quarter's $0.83 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 82.7%, 50 basis points better than the prior-year quarter. Operating margin was 30.8%, 80 basis points worse than the prior-year quarter. Net margin was 18.7%, 280 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $373.7 million. On the bottom line, the average EPS estimate is $1.20.
Next year's average estimate for revenue is $1.60 billion. The average EPS estimate is $5.17.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 705 members out of 769 rating the stock outperform, and 64 members rating it underperform. Among 214 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 197 give F5 Networks a green thumbs-up, and 17 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on F5 Networks is outperform, with an average price target of $120.91.
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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 owns shares of F5 Networks. Motley Fool newsletter services recommend F5 Networks. 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.