The 10-second takeaway
For the quarter ended June 30 (Q2), Omnicare beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased slightly. Non-GAAP earnings per share expanded significantly. GAAP earnings per share increased significantly.
Gross margins grew, operating margins dropped, net margins expanded.
Omnicare booked revenue of $1.57 billion. The seven analysts polled by S&P Capital IQ expected to see sales of $1.54 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 $0.90. The eight earnings estimates compiled by S&P Capital IQ anticipated $0.87 per share. Non-GAAP EPS of $0.90 for Q2 were 43% higher than the prior-year quarter's $0.63 per share. GAAP EPS of $0.48 for Q2 were 182% higher than the prior-year quarter's $0.17 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 24.1%, 20 basis points better than the prior-year quarter. Operating margin was 7.3%, 190 basis points worse than the prior-year quarter. Net margin was 3.3%, 210 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.53 billion. On the bottom line, the average EPS estimate is $0.88.
Next year's average estimate for revenue is $6.14 billion. The average EPS estimate is $3.56.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 221 members out of 241 rating the stock outperform, and 20 members rating it underperform. Among 93 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 91 give Omnicare 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 Omnicare is outperform, with an average price target of $48.88.
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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.