The 10-second takeaway
For the quarter ended March 31 (Q4), Quality Systems missed estimates on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew slightly. Non-GAAP earnings per share shrank significantly. GAAP earnings per share dropped to a loss.
Margins shrank across the board.
Quality Systems notched revenue of $111.3 million. The 18 analysts polled by S&P Capital IQ predicted sales of $117.6 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 $0.21. The 15 earnings estimates compiled by S&P Capital IQ predicted $0.28 per share. Non-GAAP EPS of $0.21 for Q4 were 16% lower than the prior-year quarter's $0.25 per share. GAAP EPS were -$0.07 for Q4 versus $0.25 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 56.6%, 490 basis points worse than the prior-year quarter. Operating margin was 13.7%, 770 basis points worse than the prior-year quarter. Net margin was -3.7%, much worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $121.0 million. On the bottom line, the average EPS estimate is $0.27.
Next year's average estimate for revenue is $498.2 million. The average EPS estimate is $1.18.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 2,116 members out of 2,183 rating the stock outperform, and 67 members rating it underperform. Among 654 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 639 give Quality Systems a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Quality Systems is hold, with an average price target of $17.77.
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