National Oilwell Varco
The 10-second takeaway
For the quarter ended June 30 (Q2), National Oilwell Varco beat expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly. Non-GAAP earnings per share shrank. GAAP earnings per share dropped.
Margins shrank across the board.
National Oilwell Varco reported revenue of $5.60 billion. The 19 analysts polled by S&P Capital IQ wanted to see sales of $5.42 billion on the same basis. GAAP reported sales were 18% higher than the prior-year quarter's $4.73 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 $1.33. The 28 earnings estimates compiled by S&P Capital IQ predicted $1.33 per share. Non-GAAP EPS of $1.33 for Q2 were 8.9% lower than the prior-year quarter's $1.46 per share. GAAP EPS of $1.24 for Q2 were 13% lower than the prior-year quarter's $1.42 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 23.6%, 400 basis points worse than the prior-year quarter. Operating margin was 13.7%, 490 basis points worse than the prior-year quarter. Net margin was 9.5%, 330 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $5.63 billion. On the bottom line, the average EPS estimate is $1.42.
Next year's average estimate for revenue is $22.23 billion. The average EPS estimate is $5.55.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 4,072 members out of 4,129 rating the stock outperform, and 57 members rating it underperform. Among 966 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 959 give National Oilwell Varco 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 National Oilwell Varco is outperform, with an average price target of $81.54.
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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 recommends National Oilwell Varco. The Motley Fool owns shares of National Oilwell Varco. 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.