The 10-second takeaway
For the quarter ended March 31 (Q1), DIRECTV met expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded. Non-GAAP earnings per share expanded significantly. GAAP earnings per share grew.
Gross margins shrank, operating margins grew, net margins dropped.
DIRECTV booked revenue of $7.58 billion. The 21 analysts polled by S&P Capital IQ hoped for revenue of $7.53 billion on the same basis. GAAP reported sales were 7.6% higher than the prior-year quarter's $7.05 billion.
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 $1.43. The 24 earnings estimates compiled by S&P Capital IQ predicted $1.10 per share. Non-GAAP EPS of $1.43 for Q1 were 34% higher than the prior-year quarter's $1.07 per share. GAAP EPS of $1.20 for Q1 were 12% higher than the prior-year quarter's $1.07 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 49.3%, 10 basis points worse than the prior-year quarter. Operating margin was 18.6%, 10 basis points better than the prior-year quarter. Net margin was 9.1%, 130 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $7.76 billion. On the bottom line, the average EPS estimate is $1.37.
Next year's average estimate for revenue is $31.89 billion. The average EPS estimate is $4.86.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 780 members out of 856 rating the stock outperform, and 76 members rating it underperform. Among 244 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 233 give DIRECTV a green thumbs-up, and 11 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on DIRECTV is outperform, with an average price target of $57.40.
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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 recommends DirecTV. 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.