The 10-second takeaway
For the quarter ended Sep. 30 (Q3), AFC Enterprises missed slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share expanded significantly.
Gross margins grew, operating margins contracted, net margins grew.
AFC Enterprises chalked up revenue of $38.9 million. The three analysts polled by S&P Capital IQ expected a top line of $39.6 million on the same basis. GAAP reported sales were 9.9% higher than the prior-year quarter's $35.4 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 $0.29. The five earnings estimates compiled by S&P Capital IQ anticipated $0.27 per share. GAAP EPS of $0.29 for Q3 were 21% higher than the prior-year quarter's $0.24 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 71.0%, 180 basis points better than the prior-year quarter. Operating margin was 28.5%, 120 basis points worse than the prior-year quarter. Net margin was 17.7%, 130 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $43.8 million. On the bottom line, the average EPS estimate is $0.31.
Next year's average estimate for revenue is $175.6 million. The average EPS estimate is $1.19.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 69 members out of 83 rating the stock outperform, and 14 members rating it underperform. Among 24 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 21 give AFC Enterprises a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on AFC Enterprises is outperform, with an average price target of $29.00.
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