The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Teradata missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share expanded significantly.
Margins increased across the board.
Teradata notched revenue of $647.0 million. The 18 analysts polled by S&P Capital IQ anticipated sales of $667.4 million on the same basis. GAAP reported sales were 7.5% higher than the prior-year quarter's $602.0 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 $0.69. The 19 earnings estimates compiled by S&P Capital IQ forecast $0.67 per share. GAAP EPS of $0.60 for Q3 were 18% higher than the prior-year quarter's $0.51 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 55.8%, 130 basis points better than the prior-year quarter. Operating margin was 22.1%, 120 basis points better than the prior-year quarter. Net margin was 16.1%, 160 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $750.2 million. On the bottom line, the average EPS estimate is $0.73.
Next year's average estimate for revenue is $2.69 billion. The average EPS estimate is $2.80.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 614 members out of 643 rating the stock outperform, and 29 members rating it underperform. Among 173 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 166 give Teradata a green thumbs-up, and seven give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Teradata is outperform, with an average price target of $82.94.
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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 Teradata. Motley Fool newsletter services recommend Teradata. 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.