The 10-second takeaway
For the quarter ended Sep. 28 (Q2), Computer Sciences met expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share increased.
Margins expanded across the board.
Computer Sciences tallied revenue of $3.85 billion. The 14 analysts polled by S&P Capital IQ predicted a top line of $3.88 billion on the same basis. GAAP reported sales were 2.8% lower than the prior-year quarter's $3.97 billion.
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 $1.08. The 16 earnings estimates compiled by S&P Capital IQ predicted $0.49 per share. GAAP EPS were $0.83 for Q2 versus -$18.56 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 22.3%, 510 basis points better than the prior-year quarter. Operating margin was 7.8%, 540 basis points better than the prior-year quarter. Net margin was 3.4%, 7,590 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $3.84 billion. On the bottom line, the average EPS estimate is $0.64.
Next year's average estimate for revenue is $15.69 billion. The average EPS estimate is $2.28.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 254 members out of 298 rating the stock outperform, and 44 members rating it underperform. Among 87 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 77 give Computer Sciences 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 Computer Sciences is hold, with an average price target of $31.77.
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