The 10-second takeaway
For the quarter ended June 30 (Q4), Twin Disc beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted significantly. Non-GAAP earnings per share grew significantly. GAAP earnings per share contracted to zero.
Margins dropped across the board.
Twin Disc logged revenue of $75.9 million. The two analysts polled by S&P Capital IQ predicted revenue of $73.2 million on the same basis. GAAP reported sales were 21% lower than the prior-year quarter's $96.1 million.
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 $0.19. The two earnings estimates compiled by S&P Capital IQ predicted $0.16 per share. Non-GAAP EPS of $0.19 for Q4 were 27% higher than the prior-year quarter's $0.15 per share. GAAP EPS dropped to zero from the prior-year quarter's $0.11.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 27.2%, 220 basis points worse than the prior-year quarter. Operating margin was 4.6%, 500 basis points worse than the prior-year quarter. Net margin was 0.1%, 120 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $69.3 million. On the bottom line, the average EPS estimate is $0.13.
Next year's average estimate for revenue is $294.3 million. The average EPS estimate is $0.84.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 314 members out of 321 rating the stock outperform, and seven members rating it underperform. Among 82 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 79 give Twin Disc a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Twin Disc is outperform, with an average price target of $24.00.
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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.