Key Energy Services
The 10-second takeaway
For the quarter ended June 30 (Q2), Key Energy Services missed estimates on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted significantly. Non-GAAP earnings per share dropped significantly. GAAP earnings per share dropped to a loss.
Margins shrank across the board.
Key Energy Services reported revenue of $411.4 million. The 11 analysts polled by S&P Capital IQ expected revenue of $421.2 million on the same basis. GAAP reported sales were 20% lower than the prior-year quarter's $516.0 million.
EPS came in at $0.01. The 17 earnings estimates compiled by S&P Capital IQ predicted $0.01 per share. Non-GAAP EPS of $0.01 for Q2 were 95% lower than the prior-year quarter's $0.21 per share. (The prior-year quarter included -$0.02 per share in earnings from discontinued operations.) GAAP EPS were -$0.03 for Q2 against $0.19 per share for the prior-year quarter.
For the quarter, gross margin was 30.2%, 310 basis points worse than the prior-year quarter. Operating margin was 2.0%, 990 basis points worse than the prior-year quarter. Net margin was -1.0%, 660 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $455.7 million. On the bottom line, the average EPS estimate is $0.07.
Next year's average estimate for revenue is $1.76 billion. The average EPS estimate is $0.17.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 289 members out of 304 rating the stock outperform, and 15 members rating it underperform. Among 67 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 64 give Key Energy Services a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Key Energy Services is hold, with an average price target of $7.85.
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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.