The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Tesco missed estimates on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share grew significantly.
Margins grew across the board.
Tesco reported revenue of $126.4 million. The four analysts polled by S&P Capital IQ expected net sales of $131.0 million on the same basis. GAAP reported sales were 0.5% lower than the prior-year quarter's $127.0 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 $0.23. The seven earnings estimates compiled by S&P Capital IQ forecast $0.28 per share. GAAP EPS of $0.23 for Q3 were 130% higher than the prior-year quarter's $0.10 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 23.5%, 420 basis points better than the prior-year quarter. Operating margin was 13.1%, 650 basis points better than the prior-year quarter. Net margin was 7.1%, 410 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $132.0 million. On the bottom line, the average EPS estimate is $0.28.
Next year's average estimate for revenue is $550.8 million. The average EPS estimate is $1.17.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 274 members out of 286 rating the stock outperform, and 12 members rating it underperform. Among 81 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 79 give Tesco a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Tesco is outperform, with an average price target of $15.00.
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