The 10-second takeaway
For the quarter ended March 31 (Q1), Athenahealth beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly. Non-GAAP earnings per share increased significantly. GAAP earnings per share contracted significantly.
Margins shrank across the board.
Athenahealth tallied revenue of $125.6 million. The 14 analysts polled by S&P Capital IQ foresaw revenue of $121.1 million on the same basis. GAAP reported sales were 30% higher than the prior-year quarter's $96.6 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 $0.38. The 16 earnings estimates compiled by S&P Capital IQ averaged $0.23 per share. Non-GAAP EPS of $0.38 for Q1 were 171% higher than the prior-year quarter's $0.14 per share. GAAP EPS of $0.02 for Q1 were 71% lower than the prior-year quarter's $0.07 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 57.7%, 210 basis points worse than the prior-year quarter. Operating margin was -9.5%, much worse than the prior-year quarter. Net margin was 0.6%, 190 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $132.6 million. On the bottom line, the average EPS estimate is $0.29.
Next year's average estimate for revenue is $542.3 million. The average EPS estimate is $1.21.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 194 members out of 252 rating the stock outperform, and 58 members rating it underperform. Among 67 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 54 give Athenahealth a green thumbs-up, and 13 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Athenahealth is hold, with an average price target of $91.54.
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