The 10-second takeaway
For the quarter ended June 30 (Q2), Travelzoo met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew. GAAP earnings per share shrank significantly.
Margins dropped across the board.
Travelzoo tallied revenue of $41.3 million. The two analysts polled by S&P Capital IQ looked for sales of $41.0 million 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 $0.34. The two earnings estimates compiled by S&P Capital IQ predicted $0.27 per share. GAAP EPS of $0.34 for Q2 were 24% lower than the prior-year quarter's $0.45 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 89.3%, 150 basis points worse than the prior-year quarter. Operating margin was 18.9%, 740 basis points worse than the prior-year quarter. Net margin was 12.6%, 580 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $38.7 million. On the bottom line, the average EPS estimate is $0.26.
Next year's average estimate for revenue is $160.7 million. The average EPS estimate is $1.17.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 400 members out of 581 rating the stock outperform, and 181 members rating it underperform. Among 145 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 88 give Travelzoo a green thumbs-up, and 57 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Travelzoo is hold, with an average price target of $28.00.
Internet software and services are being consumed in radically different ways, on new and increasingly mobile devices. Is Travelzoo on the right side of the revolution? Check out the changing landscape and meet the company that Motley Fool analysts expect to lead "The Next Trillion-dollar Revolution." Click here for instant access to this free report.
- Add Travelzoo to My Watchlist.
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.