The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Quad/Graphics beat slightly on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share increased.
Gross margins dropped, operating margins dropped, net margins grew.
Quad/Graphics logged revenue of $1.04 billion. The three analysts polled by S&P Capital IQ expected a top line of $1.03 billion on the same basis. GAAP reported sales were 6.3% lower than the prior-year quarter's $1.11 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 $1.10. The three earnings estimates compiled by S&P Capital IQ predicted $0.64 per share. GAAP EPS were $0.84 for Q3 versus -$0.48 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 23.2%, 100 basis points worse than the prior-year quarter. Operating margin was 6.8%, 110 basis points worse than the prior-year quarter. Net margin was 3.8%, 580 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.12 billion. On the bottom line, the average EPS estimate is $0.86.
Next year's average estimate for revenue is $4.07 billion. The average EPS estimate is $1.84.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 16 members out of 30 rating the stock outperform, and 14 members rating it underperform. Among 10 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), three give Quad/Graphics 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 Quad/Graphics is hold, with an average price target of $18.75.
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