The 10-second takeaway
For the quarter ended June 30 (Q2), Pitney Bowes missed estimates on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share grew. GAAP earnings per share contracted to a loss.
Gross margins increased, operating margins grew, net margins dropped.
Pitney Bowes recorded revenue of $1.16 billion. The four analysts polled by S&P Capital IQ anticipated a top line of $1.19 billion on the same basis. GAAP reported sales were 7.0% lower than the prior-year quarter's $1.25 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 $0.52. The six earnings estimates compiled by S&P Capital IQ predicted $0.43 per share. Non-GAAP EPS of $0.52 for Q2 were 4.0% higher than the prior-year quarter's $0.50 per share. GAAP EPS were -$0.05 for Q2 versus $0.50 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 50.6%, 120 basis points better than the prior-year quarter. Operating margin was 15.4%, 10 basis points better than the prior-year quarter. Net margin was -0.8%, 880 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.10 billion. On the bottom line, the average EPS estimate is $0.43.
Next year's average estimate for revenue is $4.65 billion. The average EPS estimate is $1.82.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 301 members out of 363 rating the stock outperform, and 62 members rating it underperform. Among 107 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 97 give Pitney Bowes a green thumbs-up, and 10 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Pitney Bowes is outperform, with an average price target of $17.00.
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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 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.