The 10-second takeaway
For the quarter ended March 31 (Q1), Wendy's missed slightly on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue increased slightly. Non-GAAP earnings per share grew. GAAP earnings per share contracted.
Gross margins expanded, operating margins contracted, net margins dropped.
Wendy's recorded revenue of $603.7 million. The 17 analysts polled by S&P Capital IQ anticipated sales of $614.7 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 $0.03. The 20 earnings estimates compiled by S&P Capital IQ anticipated $0.03 per share. Non-GAAP EPS of $0.03 for Q1 were 200% higher than the prior-year quarter's $0.01 per share. GAAP EPS of $0.01 for Q1 were 67% lower than the prior-year quarter's $0.03 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 23.7%, 50 basis points better than the prior-year quarter. Operating margin was 4.2%, 80 basis points worse than the prior-year quarter. Net margin was 0.4%, 170 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $664.4 million. On the bottom line, the average EPS estimate is $0.06.
Next year's average estimate for revenue is $2.58 billion. The average EPS estimate is $0.19.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 589 members out of 735 rating the stock outperform, and 146 members rating it underperform. Among 167 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 136 give Wendy's a green thumbs-up, and 31 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Wendy's is hold, with an average price target of $5.44.
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