The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Eastman Chemical missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share dropped.
Gross margins were steady, operating margins shrank, net margins dropped.
Eastman Chemical booked revenue of $2.26 billion. The 10 analysts polled by S&P Capital IQ expected sales of $2.36 billion on the same basis. GAAP reported sales were 25% higher than the prior-year quarter's $1.81 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 $1.57. The 14 earnings estimates compiled by S&P Capital IQ anticipated $1.42 per share. GAAP EPS of $0.99 for Q3 were 15% lower than the prior-year quarter's $1.16 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 23.2%, about the same as the prior-year quarter. Operating margin was 13.3%, 120 basis points worse than the prior-year quarter. Net margin was 6.8%, 230 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.31 billion. On the bottom line, the average EPS estimate is $1.22.
Next year's average estimate for revenue is $8.32 billion. The average EPS estimate is $5.26.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 181 members out of 206 rating the stock outperform, and 25 members rating it underperform. Among 54 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 50 give Eastman Chemical a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Eastman Chemical is outperform, with an average price target of $61.14.
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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.