The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Vale crushed expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share dropped significantly.
Margins dropped across the board.
Vale booked revenue of $16.36 billion. The 10 analysts polled by S&P Capital IQ expected a top line of $10.48 billion on the same basis. GAAP reported sales were 29% lower than the prior-year quarter's $15.10 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 $0.32. The 14 earnings estimates compiled by S&P Capital IQ predicted $0.51 per share. GAAP EPS of $0.32 for Q3 were 60% lower than the prior-year quarter's $0.81 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 43.2%, 1,940 basis points worse than the prior-year quarter. Operating margin was 25.0%, 2,660 basis points worse than the prior-year quarter. Net margin was 15.3%, 1,290 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $11.28 billion. On the bottom line, the average EPS estimate is $0.54.
Next year's average estimate for revenue is $45.63 billion. The average EPS estimate is $2.20.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 6,447 members out of 6,612 rating the stock outperform, and 165 members rating it underperform. Among 1,146 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,104 give Vale a green thumbs-up, and 42 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Vale is outperform, with an average price target of $23.30.
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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.