The 10-second takeaway
For the quarter ended Dec. 29 (Q4), Select Comfort missed estimates on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share shrank significantly.
Gross margins increased, operating margins dropped, net margins shrank.
Select Comfort notched revenue of $220.6 million. The nine analysts polled by S&P Capital IQ foresaw sales of $228.9 million on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $189.1 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 $0.22. The eight earnings estimates compiled by S&P Capital IQ predicted $0.32 per share. GAAP EPS of $0.22 for Q4 were 19% lower than the prior-year quarter's $0.27 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 63.5%, 60 basis points better than the prior-year quarter. Operating margin was 8.8%, 180 basis points worse than the prior-year quarter. Net margin was 5.7%, 240 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $311.3 million. On the bottom line, the average EPS estimate is $0.56.
Next year's average estimate for revenue is $1.13 billion. The average EPS estimate is $1.92.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 2,504 members out of 2,837 rating the stock outperform, and 333 members rating it underperform. Among 889 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 823 give Select Comfort a green thumbs-up, and 66 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Select Comfort is outperform, with an average price target of $38.50.
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