The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Netspend Holdings beat slightly on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share increased significantly.
Margins contracted across the board.
Netspend Holdings logged revenue of $89.7 million. The 13 analysts polled by S&P Capital IQ expected revenue of $88.7 million on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $76.8 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 $0.15. The 14 earnings estimates compiled by S&P Capital IQ anticipated $0.15 per share. GAAP EPS of $0.13 for Q4 were 18% higher than the prior-year quarter's $0.11 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 52.5%, 50 basis points worse than the prior-year quarter. Operating margin was 19.6%, 250 basis points worse than the prior-year quarter. Net margin was 11.3%, 120 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $107.0 million. On the bottom line, the average EPS estimate is $0.18.
Next year's average estimate for revenue is $412.2 million. The average EPS estimate is $0.76.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 38 members out of 38 rating the stock outperform, and members rating it underperform. Among 13 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 13 give Netspend Holdings a green thumbs-up, and give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Netspend Holdings is outperform, with an average price target of $12.00.
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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.