The 10-second takeaway
For the quarter ended June 28 (Q4), Harris beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank. Non-GAAP earnings per share shrank. GAAP earnings per share shrank significantly.
Gross margins increased, operating margins contracted, net margins shrank.
Harris chalked up revenue of $1.36 billion. The nine analysts polled by S&P Capital IQ expected sales of $1.31 billion on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $1.08 billion.
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 $1.41. The 11 earnings estimates compiled by S&P Capital IQ averaged $1.15 per share. Non-GAAP EPS of $1.41 for Q4 were 0.7% lower than the prior-year quarter's $1.42 per share. (The prior-year quarter included -$3.75 per share in earnings from discontinued operations.) GAAP EPS of $0.51 for Q4 were 53% lower than the prior-year quarter's $1.08 per share. (The prior-year quarter included -$3.75 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 34.7%, 380 basis points better than the prior-year quarter. Operating margin was 12.6%, 830 basis points worse than the prior-year quarter. Net margin was 4.1%, 790 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.23 billion. On the bottom line, the average EPS estimate is $1.12.
Next year's average estimate for revenue is $5.05 billion. The average EPS estimate is $4.73.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 610 members out of 630 rating the stock outperform, and 20 members rating it underperform. Among 178 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 173 give Harris a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Harris is hold, with an average price target of $51.00.
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