The 10-second takeaway
For the quarter ended June 30 (Q3), Johnson Controls met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded slightly. Non-GAAP earnings per share grew significantly. GAAP earnings per share expanded significantly.
Margins grew across the board.
Johnson Controls notched revenue of $10.83 billion. The 19 analysts polled by S&P Capital IQ hoped for a top line of $10.96 billion 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 $0.78. The 25 earnings estimates compiled by S&P Capital IQ anticipated $0.75 per share. Non-GAAP EPS of $0.78 for Q3 were 22% higher than the prior-year quarter's $0.64 per share. GAAP EPS of $0.83 for Q3 were 36% higher than the prior-year quarter's $0.61 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 15.5%, 100 basis points better than the prior-year quarter. Operating margin was 6.4%, 110 basis points better than the prior-year quarter. Net margin was 5.3%, 140 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $11.01 billion. On the bottom line, the average EPS estimate is $0.92.
Next year's average estimate for revenue is $42.84 billion. The average EPS estimate is $2.61.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,183 members out of 1,247 rating the stock outperform, and 64 members rating it underperform. Among 299 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 287 give Johnson Controls a green thumbs-up, and 12 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Johnson Controls is outperform, with an average price target of $40.20.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.