The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Tesco beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly. Non-GAAP earnings per share grew significantly. GAAP earnings per share increased significantly.
Margins grew across the board.
Tesco notched revenue of $137.6 million. The four analysts polled by S&P Capital IQ wanted to see revenue of $120.0 million on the same basis. GAAP reported sales were 16% lower than the prior-year quarter's $163.1 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 $0.35. The eight earnings estimates compiled by S&P Capital IQ anticipated $0.22 per share. Non-GAAP EPS of $0.35 for Q4 were 21% higher than the prior-year quarter's $0.29 per share. GAAP EPS of $0.34 for Q4 were 17% higher than the prior-year quarter's $0.29 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 21.6%, 30 basis points better than the prior-year quarter. Operating margin was 12.8%, 190 basis points better than the prior-year quarter. Net margin was 9.7%, 270 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $120.2 million. On the bottom line, the average EPS estimate is $0.23.
Next year's average estimate for revenue is $501.2 million. The average EPS estimate is $0.98.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 268 members out of 280 rating the stock outperform, and 12 members rating it underperform. Among 77 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 76 give Tesco a green thumbs-up, and one give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Tesco is outperform, with an average price target of $13.57.
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