The 10-second takeaway
For the quarter ended Nov. 30 (Q1), Apollo Group beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank and GAAP earnings per share increased.
Gross margins shrank, operating margins shrank, net margins were steady.
Apollo Group booked revenue of $1.06 billion. The 15 analysts polled by S&P Capital IQ wanted to see revenue of $1.03 billion on the same basis. GAAP reported sales were 10% lower than the prior-year quarter's $1.18 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 $1.22. The 18 earnings estimates compiled by S&P Capital IQ anticipated $0.90 per share. GAAP EPS of $1.18 for Q1 were 3.5% higher than the prior-year quarter's $1.14 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 59.0%, 220 basis points worse than the prior-year quarter. Operating margin was 22.6%, 170 basis points worse than the prior-year quarter. Net margin was 12.7%, about the same as the prior-year quarter.
Next quarter's average estimate for revenue is $846.5 million. On the bottom line, the average EPS estimate is $0.30.
Next year's average estimate for revenue is $3.77 billion. The average EPS estimate is $2.71.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 795 members out of 949 rating the stock outperform, and 154 members rating it underperform. Among 244 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 192 give Apollo Group a green thumbs-up, and 52 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Apollo Group is hold, with an average price target of $30.31.
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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 has no position in any of the stocks mentioned. 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.