Level 3 Communications
The 10-second takeaway
For the quarter ended March 31 (Q1), Level 3 Communications missed slightly on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted slightly. Non-GAAP loss per share contracted. GAAP loss per share dropped.
Margins expanded across the board.
Level 3 Communications tallied revenue of $1.58 billion. The 14 analysts polled by S&P Capital IQ hoped for revenue of $1.61 billion 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 -$0.13. The 12 earnings estimates compiled by S&P Capital IQ anticipated -$0.10 per share. Non-GAAP EPS were -$0.13 for Q1 compared to -$0.30 per share for the prior-year quarter. GAAP EPS were -$0.36 for Q1 against -$0.66 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 60.1%, 150 basis points better than the prior-year quarter. Operating margin was 9.8%, 130 basis points better than the prior-year quarter. Net margin was -4.9%, 380 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.60 billion. On the bottom line, the average EPS estimate is -$0.05.
Next year's average estimate for revenue is $6.41 billion. The average EPS estimate is -$0.14.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 1,822 members out of 1,954 rating the stock outperform, and 132 members rating it underperform. Among 229 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 202 give Level 3 Communications a green thumbs-up, and 27 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Level 3 Communications is outperform, with an average price target of $24.20.
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