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Travelzoo Beats on Both Top and Bottom Lines

By Seth Jayson - Updated Apr 10, 2017 at 1:46PM

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Just the facts, Fool.

Travelzoo (Nasdaq: TZOO) reported earnings on April 18. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Travelzoo beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded. GAAP earnings per share grew significantly.

Gross margins increased, operating margins shrank, net margins grew.

Revenue details
Travelzoo reported revenue of $42.2 million. The two analysts polled by S&P Capital IQ expected revenue of $41.2 million on the same basis. GAAP reported sales were 7.2% higher than the prior-year quarter's $39.3 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.36. The two earnings estimates compiled by S&P Capital IQ predicted $0.34 per share. GAAP EPS of $0.36 for Q1 were 57% higher than the prior-year quarter's $0.23 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 90.6%, 90 basis points better than the prior-year quarter. Operating margin was 19.1%, 520 basis points worse than the prior-year quarter. Net margin was 13.3%, 380 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $41.0 million. On the bottom line, the average EPS estimate is $0.30.

Next year's average estimate for revenue is $160.7 million. The average EPS estimate is $1.17.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 408 members out of 589 rating the stock outperform, and 181 members rating it underperform. Among 137 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 78 give Travelzoo a green thumbs-up, and 59 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Travelzoo is hold, with an average price target of $23.00.

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Stocks Mentioned

Travelzoo Inc. Stock Quote
Travelzoo Inc.
TZOO
$6.90 (-2.27%) $0.16

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