The 10-second takeaway
For the quarter ended March 31 (Q1), Changyou.com beat expectations on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue grew significantly. GAAP earnings per share grew significantly.
Margins contracted across the board.
Changyou.com booked revenue of $177.6 million. The eight analysts polled by S&P Capital IQ foresaw a top line of $172.7 million on the same basis. GAAP reported sales were 30% higher than the prior-year quarter's $136.8 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 $1.45. The eight earnings estimates compiled by S&P Capital IQ averaged $1.42 per share. GAAP EPS of $1.45 for Q1 were 19% higher than the prior-year quarter's $1.22 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 83.1%, 130 basis points worse than the prior-year quarter. Operating margin was 57.2%, 120 basis points worse than the prior-year quarter. Net margin was 43.7%, 400 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $179.3 million. On the bottom line, the average EPS estimate is $1.44.
Next year's average estimate for revenue is $739.9 million. The average EPS estimate is $5.90.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 186 members out of 217 rating the stock outperform, and 31 members rating it underperform. Among 32 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 25 give Changyou.com a green thumbs-up, and seven give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Changyou.com is outperform, with an average price target of $36.07.
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