The 10-second takeaway
For the quarter ended March 31 (Q1), Merge Healthcare met expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded. Non-GAAP earnings per share shrank to a loss. GAAP loss per share increased.
Gross margins dropped, operating margins expanded, net margins dropped.
Merge Healthcare notched revenue of $63.6 million. The five analysts polled by S&P Capital IQ anticipated sales of $63.7 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 -$0.01. The four earnings estimates compiled by S&P Capital IQ anticipated $0.04 per share. Non-GAAP EPS were -$0.01 for Q1 compared to $0.03 per share for the prior-year quarter. GAAP EPS were -$0.07 for Q1 compared to -$0.02 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 58.5%, 360 basis points worse than the prior-year quarter. Operating margin was 10.7%, 80 basis points better than the prior-year quarter. Net margin was -10.2%, 720 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $65.6 million. On the bottom line, the average EPS estimate is $0.04.
Next year's average estimate for revenue is $265.1 million. The average EPS estimate is $0.16.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 111 members out of 132 rating the stock outperform, and 21 members rating it underperform. Among 33 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 29 give Merge Healthcare a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Merge Healthcare is outperform, with an average price target of $3.87.
Is Merge Healthcare the best health care stock for you? Learn how to maximize your investment income and "Secure Your Future With 9 Rock-Solid Dividend Stocks," including one above-average health care logistics company. Click here for instant access to this free report.
- Add Merge Healthcare to My Watchlist.
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.