Choice Hotels International
The 10-second takeaway
For the quarter ended June 30 (Q2), Choice Hotels International beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded. GAAP earnings per share dropped.
Gross margins grew, operating margins contracted, net margins contracted.
Choice Hotels International chalked up revenue of $183.6 million. The nine analysts polled by S&P Capital IQ foresaw sales of $180.5 million on the same basis. GAAP reported sales were 5.7% higher than the prior-year quarter's $173.6 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 $0.48. The 15 earnings estimates compiled by S&P Capital IQ predicted $0.46 per share. GAAP EPS of $0.48 for Q2 were 13% lower than the prior-year quarter's $0.55 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 45.2%, 20 basis points better than the prior-year quarter. Operating margin was 27.4%, 230 basis points worse than the prior-year quarter. Net margin was 15.4%, 300 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $222.8 million. On the bottom line, the average EPS estimate is $0.69.
Next year's average estimate for revenue is $727.2 million. The average EPS estimate is $1.88.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 68 members out of 89 rating the stock outperform, and 21 members rating it underperform. Among 41 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 34 give Choice Hotels International a green thumbs-up, and seven give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Choice Hotels International is hold, with an average price target of $37.53.
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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 Choice Hotels International. 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.