The 10-second takeaway
For the quarter ended June 30 (Q2), Arch Coal whiffed on revenues and exceeded expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted significantly. Non-GAAP loss per share expanded. GAAP loss per share dropped.
Gross margins dropped, operating margins dropped, net margins grew.
Arch Coal tallied revenue of $766.3 million. The nine analysts polled by S&P Capital IQ anticipated a top line of $919.7 million on the same basis. GAAP reported sales were 28% lower than the prior-year quarter's $1.06 billion.
EPS came in at -$0.29. The 19 earnings estimates compiled by S&P Capital IQ predicted -$0.33 per share. Non-GAAP EPS were -$0.29 for Q2 against -$0.10 per share for the prior-year quarter. GAAP EPS were -$0.34 for Q2 compared to -$2.05 per share for the prior-year quarter.
For the quarter, gross margin was 14.4%, 270 basis points worse than the prior-year quarter. Operating margin was -2.1%, 700 basis points worse than the prior-year quarter. Net margin was -9.4%, much better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $913.8 million. On the bottom line, the average EPS estimate is -$0.34.
Next year's average estimate for revenue is $3.47 billion. The average EPS estimate is -$1.32.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,472 members out of 1,547 rating the stock outperform, and 75 members rating it underperform. Among 279 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 264 give Arch Coal a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Arch Coal is hold, with an average price target of $5.98.
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