The 10-second takeaway
For the quarter ended June 30 (Q2), General Electric met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share shrank. GAAP earnings per share expanded.
Gross margins contracted, operating margins shrank, net margins grew.
General Electric booked revenue of $35.12 billion. The 10 analysts polled by S&P Capital IQ hoped for net sales of $35.49 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 $0.36. The 14 earnings estimates compiled by S&P Capital IQ predicted $0.35 per share. Non-GAAP EPS of $0.36 for Q2 were 5.3% lower than the prior-year quarter's $0.38 per share. (The prior-year quarter included -$0.05 per share in earnings from discontinued operations.) GAAP EPS of $0.30 for Q2 were 3.4% higher than the prior-year quarter's $0.29 per share. (The prior-year quarter included -$0.05 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 10.6%, much worse than the prior-year quarter. Operating margin was 10.6%, 150 basis points worse than the prior-year quarter. Net margin was 8.9%, 40 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $36.63 billion. On the bottom line, the average EPS estimate is $0.40.
Next year's average estimate for revenue is $144.65 billion. The average EPS estimate is $1.66.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 15,559 members out of 16,613 rating the stock outperform, and 1,054 members rating it underperform. Among 3,081 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 2,946 give General Electric a green thumbs-up, and 135 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on General Electric is outperform, with an average price target of $25.75.
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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 owns shares of General Electric Company. 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.