The 10-second takeaway
For the quarter ended June 30 (Q2), Masco met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased. Non-GAAP earnings per share expanded significantly. GAAP earnings per share grew.
Margins grew across the board.
Masco reported revenue of $2.10 billion. The 14 analysts polled by S&P Capital IQ anticipated sales of $2.10 billion on the same basis. GAAP reported sales were 7.2% higher than the prior-year quarter's $2.00 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
EPS came in at $0.23. The 17 earnings estimates compiled by S&P Capital IQ predicted $0.20 per share. Non-GAAP EPS of $0.23 for Q2 were 130% higher than the prior-year quarter's $0.10 per share. (The prior-year quarter included -$0.05 per share in earnings from discontinued operations.) GAAP EPS were $0.21 for Q2 versus -$0.22 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
For the quarter, gross margin was 28.3%, 210 basis points better than the prior-year quarter. Operating margin was 8.7%, 260 basis points better than the prior-year quarter. Net margin was 3.6%, 730 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $2.08 billion. On the bottom line, the average EPS estimate is $0.25.
Next year's average estimate for revenue is $8.05 billion. The average EPS estimate is $0.78.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 244 members out of 296 rating the stock outperform, and 52 members rating it underperform. Among 106 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 94 give Masco 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 Masco is outperform, with an average price target of $21.61.
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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. 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.