The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Lexmark International beat expectations on revenues and whiffed on earnings per share.
Compared to the prior-year quarter, revenue shrank and GAAP earnings per share shrank significantly.
Margins shrank across the board.
Lexmark International chalked up revenue of $968.0 million. The nine analysts polled by S&P Capital IQ looked for revenue of $932.8 million on the same basis. GAAP reported sales were 8.7% lower than the prior-year quarter's $1.06 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 $0.61. The 12 earnings estimates compiled by S&P Capital IQ predicted $0.89 per share. GAAP EPS of $0.10 for Q4 were 89% lower than the prior-year quarter's $0.94 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 34.1%, 370 basis points worse than the prior-year quarter. Operating margin was 3.4%, 760 basis points worse than the prior-year quarter. Net margin was 0.7%, 580 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $877.7 million. On the bottom line, the average EPS estimate is $0.98.
Next year's average estimate for revenue is $3.49 billion. The average EPS estimate is $3.87.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 146 members out of 230 rating the stock outperform, and 84 members rating it underperform. Among 78 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 53 give Lexmark International a green thumbs-up, and 25 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Lexmark International is underperform, with an average price target of $20.78.
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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.