The 10-second takeaway
For the quarter ended June 29 (Q2), Thoratec beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded. Non-GAAP earnings per share grew significantly. GAAP earnings per share expanded.
Gross margins contracted, operating margins dropped, net margins expanded.
Thoratec booked revenue of $130.5 million. The 14 analysts polled by S&P Capital IQ wanted to see revenue of $121.4 million on the same basis. GAAP reported sales were 10.0% higher than the prior-year quarter's $118.7 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 $0.52. The 15 earnings estimates compiled by S&P Capital IQ averaged $0.43 per share. Non-GAAP EPS of $0.52 for Q2 were 16% higher than the prior-year quarter's $0.45 per share. GAAP EPS of $0.40 for Q2 were 14% higher than the prior-year quarter's $0.35 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 68.6%, 100 basis points worse than the prior-year quarter. Operating margin was 25.3%, 70 basis points worse than the prior-year quarter. Net margin was 17.8%, 30 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $120.8 million. On the bottom line, the average EPS estimate is $0.42.
Next year's average estimate for revenue is $496.6 million. The average EPS estimate is $1.74.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 148 members out of 168 rating the stock outperform, and 20 members rating it underperform. Among 48 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 40 give Thoratec a green thumbs-up, and eight give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Thoratec is outperform, with an average price target of $38.50.
Is Thoratec the best health care stock for you? Learn how to maximize your investment income and "Secure Your Future With 9 Rock-Solid Dividend Stocks," including one above-average health care logistics company. Click here for instant access to this free report.
- Add Thoratec to My Watchlist.
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.