The 10-second takeaway
For the quarter ended June 30 (Q2), Nutrisystem missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted significantly. GAAP earnings per share grew significantly.
Gross margins grew, operating margins contracted, net margins grew.
Nutrisystem logged revenue of $97.5 million. The three analysts polled by S&P Capital IQ expected a top line of $100.1 million on the same basis. GAAP reported sales were 22% lower than the prior-year quarter's $124.6 million.
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 $0.22. The five earnings estimates compiled by S&P Capital IQ forecast $0.18 per share. GAAP EPS of $0.22 for Q2 were 57% higher than the prior-year quarter's $0.14 per share.
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 51.0%, 430 basis points better than the prior-year quarter. Operating margin was 10.1%, 80 basis points worse than the prior-year quarter. Net margin was 6.5%, 320 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $80.7 million. On the bottom line, the average EPS estimate is $0.12.
Next year's average estimate for revenue is $352.7 million. The average EPS estimate is $0.32.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 790 members out of 886 rating the stock outperform, and 96 members rating it underperform. Among 177 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 158 give Nutrisystem a green thumbs-up, and 19 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Nutrisystem is outperform, with an average price target of $10.00.
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