The 10-second takeaway
For the quarter ended Dec. 29 (Q4), Winmark whiffed on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue contracted slightly. Non-GAAP earnings per share contracted significantly. GAAP earnings per share contracted significantly.
Gross margins expanded, operating margins grew, net margins dropped.
Winmark chalked up revenue of $13.1 million. The one analyst polled by S&P Capital IQ predicted sales of $15.4 million on the same basis. GAAP reported sales were the same as the prior-year quarter's.
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 $0.39. The one earnings estimate compiled by S&P Capital IQ averaged $0.55 per share. Non-GAAP EPS of $0.39 for Q4 were 54% lower than the prior-year quarter's $0.84 per share. GAAP EPS of $0.34 for Q4 were 58% lower than the prior-year quarter's $0.80 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 91.5%, 190 basis points better than the prior-year quarter. Operating margin was 53.1%, 90 basis points better than the prior-year quarter. Net margin was 13.4%, much worse than the prior-year quarter.
Next quarter's average estimate for revenue is $14.4 million. On the bottom line, the average EPS estimate is $0.77.
Next year's average estimate for revenue is $61.8 million. The average EPS estimate is $3.55.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 33 members out of 47 rating the stock outperform, and 14 members rating it underperform. Among 19 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 12 give Winmark a green thumbs-up, and seven give it a red thumbs-down.
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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.