The 10-second takeaway
For the quarter ended Sep. 30 (Q1), News met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased slightly and GAAP earnings per share expanded significantly.
Gross margins increased, operating margins dropped, net margins grew.
News booked revenue of $8.14 billion. The 20 analysts polled by S&P Capital IQ expected a top line of $8.15 billion on the same basis. GAAP reported sales were 2.2% higher than the prior-year quarter's $7.96 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 $0.43. The 22 earnings estimates compiled by S&P Capital IQ anticipated $0.38 per share. GAAP EPS of $0.94 for Q1 were 236% higher than the prior-year quarter's $0.28 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 40.4%, 10 basis points better than the prior-year quarter. Operating margin was 16.9%, 50 basis points worse than the prior-year quarter. Net margin was 27.4%, 1,810 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $9.23 billion. On the bottom line, the average EPS estimate is $0.44.
Next year's average estimate for revenue is $34.93 billion. The average EPS estimate is $1.67.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 116 members out of 142 rating the stock outperform, and 26 members rating it underperform. Among 51 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 44 give News 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 News is outperform, with an average price target of $25.91.
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