The 10-second takeaway
For the quarter ended Nov. 30 (Q2), RPM International beat expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share dropped significantly.
Gross margins grew, operating margins were steady, net margins shrank.
RPM International tallied revenue of $1.02 billion. The four analysts polled by S&P Capital IQ foresaw sales of $997.3 million on the same basis. GAAP reported sales were 11% higher than the prior-year quarter's $916.1 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 $0.40. The eight earnings estimates compiled by S&P Capital IQ anticipated $0.42 per share. GAAP EPS of $0.31 for Q2 were 18% lower than the prior-year quarter's $0.38 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 41.8%, 150 basis points better than the prior-year quarter. Operating margin was 9.8%, about the same as the prior-year quarter. Net margin was 4.1%, 140 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $828.3 million. On the bottom line, the average EPS estimate is $0.06.
Next year's average estimate for revenue is $4.11 billion. The average EPS estimate is $1.84.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 346 members out of 370 rating the stock outperform, and 24 members rating it underperform. Among 97 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 95 give RPM International 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 RPM International is hold, with an average price target of $30.60.
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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. TMFDisclosureHere