The 10-second takeaway
For the quarter ended May 31 (Q2), OMNOVA Solutions missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted. Non-GAAP earnings per share didn't move. GAAP earnings per share contracted significantly.
Gross margins expanded, operating margins increased, net margins dropped.
OMNOVA Solutions chalked up revenue of $270.8 million. The three analysts polled by S&P Capital IQ hoped for revenue of $287.1 million on the same basis. GAAP reported sales were 12% lower than the prior-year quarter's $307.5 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 $0.16. The four earnings estimates compiled by S&P Capital IQ anticipated $0.15 per share. Non-GAAP EPS of $0.16 were the same as the prior-year quarter. GAAP EPS of $0.06 for Q2 were 60% lower than the prior-year quarter's $0.15 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 21.2%, 170 basis points better than the prior-year quarter. Operating margin was 6.6%, 20 basis points better than the prior-year quarter. Net margin was 1.1%, 120 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $293.7 million. On the bottom line, the average EPS estimate is $0.23.
Next year's average estimate for revenue is $1.11 billion. The average EPS estimate is $0.61.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 145 members out of 168 rating the stock outperform, and 23 members rating it underperform. Among 27 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 25 give OMNOVA Solutions a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on OMNOVA Solutions is outperform, with an average price target of $10.33.
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