The 10-second takeaway
For the quarter ended June 30 (Q2), Western Refining beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly. Non-GAAP earnings per share contracted significantly. GAAP earnings per share dropped significantly.
Margins contracted across the board.
Western Refining reported revenue of $2.43 billion. The five analysts polled by S&P Capital IQ predicted revenue of $2.24 billion on the same basis. GAAP reported sales were 1.6% lower than the prior-year quarter's $2.47 billion.
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 $1.25. The 11 earnings estimates compiled by S&P Capital IQ anticipated $1.21 per share. Non-GAAP EPS of $1.25 for Q2 were 34% lower than the prior-year quarter's $1.89 per share. GAAP EPS of $1.46 for Q2 were 33% lower than the prior-year quarter's $2.19 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 13.5%, 480 basis points worse than the prior-year quarter. Operating margin was 11.2%, 500 basis points worse than the prior-year quarter. Net margin was 6.1%, 360 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $2.26 billion. On the bottom line, the average EPS estimate is $0.88.
Next year's average estimate for revenue is $9.55 billion. The average EPS estimate is $3.65.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,099 members out of 1,150 rating the stock outperform, and 51 members rating it underperform. Among 256 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 248 give Western Refining 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 Western Refining is outperform, with an average price target of $39.55.
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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. The Motley Fool owns shares of Western Refining. 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.