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Harsco Beats on EPS But GAAP Results Lag

By Seth Jayson - Updated Apr 7, 2017 at 12:00PM

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Just the facts, Fool.

Harsco (NYSE: HSC) reported earnings on Nov. 1. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Harsco missed slightly on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue dropped and GAAP earnings per share dropped significantly.

Gross margins grew, operating margins grew, net margins dropped.

Revenue details
Harsco reported revenue of $756.8 million. The seven analysts polled by S&P Capital IQ foresaw net sales of $770.1 million on the same basis. GAAP reported sales were 12% lower than the prior-year quarter's $855.9 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.39. The seven earnings estimates compiled by S&P Capital IQ predicted $0.37 per share. GAAP EPS of $0.32 for Q3 were 18% lower than the prior-year quarter's $0.39 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.)

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 23.4%, 180 basis points better than the prior-year quarter. Operating margin was 6.7%, 40 basis points better than the prior-year quarter. Net margin was 3.5%, 20 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $749.7 million. On the bottom line, the average EPS estimate is $0.35.

Next year's average estimate for revenue is $3.05 billion. The average EPS estimate is $1.23.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 275 members out of 285 rating the stock outperform, and 10 members rating it underperform. Among 70 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 69 give Harsco a green thumbs-up, and one give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Harsco is outperform, with an average price target of $26.20.

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Stocks Mentioned

Harsco Corporation Stock Quote
Harsco Corporation
HSC
$7.50 (-4.58%) $0.36

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