The 10-second takeaway
For the quarter ended June 30 (Q2), iGATE beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share expanded significantly. GAAP earnings per share increased significantly.
Gross margins grew, operating margins contracted, net margins increased.
iGATE booked revenue of $283.3 million. The nine analysts polled by S&P Capital IQ foresaw revenue of $279.0 million on the same basis. GAAP reported sales were 5.7% higher than the prior-year quarter's $268.0 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 $0.44. The nine earnings estimates compiled by S&P Capital IQ predicted $0.34 per share. Non-GAAP EPS of $0.44 for Q2 were 57% higher than the prior-year quarter's $0.28 per share. GAAP EPS of $0.38 for Q2 were 443% higher than the prior-year quarter's $0.07 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 37.9%, 50 basis points better than the prior-year quarter. Operating margin was 17.5%, 40 basis points worse than the prior-year quarter. Net margin was 10.6%, 590 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $285.2 million. On the bottom line, the average EPS estimate is $0.40.
Next year's average estimate for revenue is $1.13 billion. The average EPS estimate is $1.68.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 202 members out of 210 rating the stock outperform, and eight members rating it underperform. Among 49 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 47 give iGATE 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 iGATE is hold, with an average price target of $20.14.
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