The 10-second takeaway
For the quarter ended March 31 (Q1), Web.com Group met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share expanded significantly. GAAP loss per share expanded.
Gross margins expanded, operating margins increased, net margins shrank.
Web.com Group chalked up revenue of $128.1 million. The 11 analysts polled by S&P Capital IQ looked for sales of $127.7 million on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $91.5 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 $0.48. The 12 earnings estimates compiled by S&P Capital IQ predicted $0.45 per share. Non-GAAP EPS of $0.48 for Q1 were 37% higher than the prior-year quarter's $0.35 per share. GAAP EPS were -$0.97 for Q1 against -$0.65 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 63.1%, 530 basis points better than the prior-year quarter. Operating margin was -2.2%, much better than the prior-year quarter. Net margin was -40.2%, 770 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $130.7 million. On the bottom line, the average EPS estimate is $0.48.
Next year's average estimate for revenue is $530.6 million. The average EPS estimate is $2.02.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 125 members out of 148 rating the stock outperform, and 23 members rating it underperform. Among 41 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 31 give Web.com Group a green thumbs-up, and 10 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Web.com Group is buy, with an average price target of $21.91.
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