The 10-second takeaway
For the quarter ended May 4 (Q1), Sears Holdings met expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP loss per share expanded. GAAP earnings per share dropped to a loss.
Margins contracted across the board.
Sears Holdings reported revenue of $8.45 billion. The two analysts polled by S&P Capital IQ looked for a top line of $8.37 billion on the same basis. GAAP reported sales were 8.8% lower than the prior-year quarter's $9.27 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 -$1.29. The three earnings estimates compiled by S&P Capital IQ predicted -$0.60 per share. Non-GAAP EPS were -$1.29 for Q1 versus -$0.31 per share for the prior-year quarter. GAAP EPS were -$2.63 for Q1 against $1.78 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 25.5%, 220 basis points worse than the prior-year quarter. Operating margin was -3.0%, 250 basis points worse than the prior-year quarter. Net margin was -3.3%, 530 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $8.74 billion. On the bottom line, the average EPS estimate is -$0.67.
Next year's average estimate for revenue is $36.45 billion. The average EPS estimate is -$2.43.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 1,476 members out of 2,317 rating the stock outperform, and 841 members rating it underperform. Among 532 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 331 give Sears Holdings a green thumbs-up, and 201 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Sears Holdings is underperform, with an average price target of $28.33.
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