The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Zipcar beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share expanded significantly.
Margins expanded across the board.
Zipcar booked revenue of $78.2 million. The seven analysts polled by S&P Capital IQ foresaw revenue of $75.8 million on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $68.1 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 $0.10. The four earnings estimates compiled by S&P Capital IQ predicted $0.01 per share. GAAP EPS of $0.10 for Q3 were 400% higher than the prior-year quarter's $0.02 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 41.4%, 510 basis points better than the prior-year quarter. Operating margin was 5.6%, 370 basis points better than the prior-year quarter. Net margin was 5.5%, 450 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $69.4 million. On the bottom line, the average EPS estimate is $0.10.
Next year's average estimate for revenue is $274.7 million. The average EPS estimate is $0.05.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 873 members out of 950 rating the stock outperform, and 77 members rating it underperform. Among 247 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 227 give Zipcar a green thumbs-up, and 20 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Zipcar is underperform, with an average price target of $8.17.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Zipcar. Motley Fool newsletter services recommend Zipcar. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.