The 10-second takeaway
For the quarter ended Sep. 28 (Q4), Covidien met expectations on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue contracted slightly and GAAP earnings per share expanded.
Gross margins contracted, operating margins were steady, net margins grew.
Covidien logged revenue of $3.00 billion. The 15 analysts polled by S&P Capital IQ wanted to see revenue of $2.98 billion on the same basis. GAAP reported sales were 2.5% lower than the prior-year quarter's $3.08 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 $1.02. The 18 earnings estimates compiled by S&P Capital IQ predicted $1.00 per share. GAAP EPS of $0.96 for Q4 were 4.3% higher than the prior-year quarter's $0.92 per share. (The prior-year quarter included -$0.02 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 56.5%, 30 basis points worse than the prior-year quarter. Operating margin was 22.3%, about the same as the prior-year quarter. Net margin was 15.4%, 70 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $3.00 billion. On the bottom line, the average EPS estimate is $1.07.
Next year's average estimate for revenue is $12.36 billion. The average EPS estimate is $4.42.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Covidien is outperform, with an average price target of $64.83.
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