The 10-second takeaway
For the quarter ended Sep. 30 (Q3), United Online beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank slightly and GAAP earnings per share dropped significantly.
Margins contracted across the board.
United Online reported revenue of $177.8 million. The two analysts polled by S&P Capital IQ anticipated a top line of $173.8 million on the same basis. GAAP reported sales were 2.7% lower than the prior-year quarter's $182.7 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 two earnings estimates compiled by S&P Capital IQ averaged $0.11 per share. GAAP EPS of $0.05 for Q3 were 62% lower than the prior-year quarter's $0.13 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 49.7%, 500 basis points worse than the prior-year quarter. Operating margin was 4.0%, 690 basis points worse than the prior-year quarter. Net margin was 2.8%, 370 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $211.3 million. On the bottom line, the average EPS estimate is $0.14.
Next year's average estimate for revenue is $859.7 million. The average EPS estimate is $0.64.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 258 members out of 281 rating the stock outperform, and 23 members rating it underperform. Among 54 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 44 give United Online a green thumbs-up, and 10 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on United Online is buy, with an average price target of $7.07.
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