The 10-second takeaway
For the quarter ended Dec. 31 (Q4), TransAlta beat expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share grew significantly. GAAP earnings per share grew significantly.
Margins grew across the board.
TransAlta recorded revenue of $663.2 million. The two analysts polled by S&P Capital IQ wanted to see net sales of $648.8 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 $0.21. The 10 earnings estimates compiled by S&P Capital IQ predicted $0.28 per share. Non-GAAP EPS of $0.21 for Q4 were 62% higher than the prior-year quarter's $0.13 per share. GAAP EPS of $0.15 for Q4 were 36% 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 40.8%, 310 basis points better than the prior-year quarter. Operating margin was 21.9%, 350 basis points better than the prior-year quarter. Net margin was 7.3%, 330 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $600.4 million. On the bottom line, the average EPS estimate is $0.19.
Next year's The average EPS estimate is $0.77.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 87 members out of 92 rating the stock outperform, and five members rating it underperform. Among 25 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 23 give TransAlta a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on TransAlta is hold, with an average price target of $19.62.
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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.