McDermott International
The 10-second takeaway
For the quarter ended Sep. 30 (Q3), McDermott International beat expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share expanded significantly.
Margins expanded across the board.
Revenue details
McDermott International reported revenue of $1.03 billion. The 14 analysts polled by S&P Capital IQ hoped for revenue of $985.0 million on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $879.9 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 $0.21. The 17 earnings estimates compiled by S&P Capital IQ predicted $0.24 per share. GAAP EPS of $0.21 for Q3 were 320% higher than the prior-year quarter's $0.05 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 13.5%, 480 basis points better than the prior-year quarter. Operating margin was 8.5%, 520 basis points better than the prior-year quarter. Net margin was 4.9%, 370 basis points better than the prior-year quarter.
Looking ahead
Next quarter's average estimate for revenue is $1.02 billion. On the bottom line, the average EPS estimate is $0.26.
Next year's average estimate for revenue is $3.60 billion. The average EPS estimate is $0.97.
Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,295 members out of 1,327 rating the stock outperform, and 32 members rating it underperform. Among 298 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 292 give McDermott International a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on McDermott International is outperform, with an average price target of $15.92.
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