The 10-second takeaway
For the quarter ended Sep. 30 (Q3), SM Energy beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank significantly and GAAP earnings per share contracted to a loss.
Margins contracted across the board.
SM Energy logged revenue of $379.0 million. The 12 analysts polled by S&P Capital IQ hoped for sales of $362.9 million on the same basis. GAAP reported sales were 12% higher than the prior-year quarter's $346.7 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 $0.14. The 21 earnings estimates compiled by S&P Capital IQ predicted $0.06 per share. GAAP EPS were -$0.58 for Q3 compared to $3.41 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 70.4%, 120 basis points worse than the prior-year quarter. Operating margin was -8.6%, 5,390 basis points worse than the prior-year quarter. Net margin was -9.9%, 7,630 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $400.0 million. On the bottom line, the average EPS estimate is $0.22.
Next year's average estimate for revenue is $1.45 billion. The average EPS estimate is $0.84.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 289 members out of 306 rating the stock outperform, and 17 members rating it underperform. Among 65 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 61 give SM Energy 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 SM Energy is outperform, with an average price target of $71.97.
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