The 10-second takeaway
For the quarter ended Sep. 30 (Q3), WebMD Health beat expectations on revenues and exceeded expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted and GAAP earnings per share shrank to a loss.
Margins dropped across the board.
WebMD Health reported revenue of $117.5 million. The seven analysts polled by S&P Capital IQ expected revenue of $114.3 million on the same basis. GAAP reported sales were 13% lower than the prior-year quarter's $135.1 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 -$0.06. The six earnings estimates compiled by S&P Capital IQ predicted -$0.09 per share. GAAP EPS were -$0.02 for Q3 against $0.24 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 54.6%, 910 basis points worse than the prior-year quarter. Operating margin was 1.3%, 1,860 basis points worse than the prior-year quarter. Net margin was -0.8%, 1,130 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $125.4 million. On the bottom line, the average EPS estimate is $0.00.
Next year's average estimate for revenue is $460.9 million. The average EPS estimate is -$0.36.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 110 members out of 165 rating the stock outperform, and 55 members rating it underperform. Among 47 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 32 give WebMD Health a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on WebMD Health is hold, with an average price target of $15.67.
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