The 10-second takeaway
For the quarter ended June 30 (Q1), Quality Systems missed estimates on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted. GAAP earnings per share shrank significantly.
Margins shrank across the board.
Quality Systems chalked up revenue of $109.5 million. The 18 analysts polled by S&P Capital IQ anticipated net sales of $115.7 million on the same basis. GAAP reported sales were 7.4% lower than the prior-year quarter's $118.3 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 $0.22. The 20 earnings estimates compiled by S&P Capital IQ predicted $0.22 per share. GAAP EPS of $0.22 for Q1 were 15% lower than the prior-year quarter's $0.26 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 56.1%, 300 basis points worse than the prior-year quarter. Operating margin was 17.9%, 200 basis points worse than the prior-year quarter. Net margin was 11.8%, 130 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $118.7 million. On the bottom line, the average EPS estimate is $0.24.
Next year's average estimate for revenue is $481.2 million. The average EPS estimate is $0.97.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,095 members out of 2,165 rating the stock outperform, and 70 members rating it underperform. Among 692 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 680 give Quality Systems 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 Quality Systems is hold, with an average price target of $18.37.
Can your portfolio provide you with enough income to last through retirement? You'll need more than Quality Systems. Learn how to maximize your investment income and "Secure Your Future With 9 Rock-Solid Dividend Stocks." Click here for instant access to this free report.
- Add Quality Systems 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 recommends Quality Systems. 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.