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Owens-Illinois Beats on EPS But GAAP Results Lag

Wednesday - 4/24/2013, 2:00am  ET

Owens-Illinois reported earnings on April 23. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Owens-Illinois missed estimates on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue shrank. Non-GAAP earnings per share dropped significantly. GAAP earnings per share shrank significantly.

Margins dropped across the board.

Revenue details
Owens-Illinois logged revenue of $1.64 billion. The nine analysts polled by S&P Capital IQ hoped for a top line of $1.71 billion on the same basis. GAAP reported sales were 5.6% lower than the prior-year quarter's $1.74 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.60. The 11 earnings estimates compiled by S&P Capital IQ forecast $0.57 per share. Non-GAAP EPS of $0.60 for Q1 were 18% lower than the prior-year quarter's $0.73 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.) GAAP EPS of $0.42 for Q1 were 42% lower than the prior-year quarter's $0.72 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.)

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 19.4%, 230 basis points worse than the prior-year quarter. Operating margin was 10.7%, 210 basis points worse than the prior-year quarter. Net margin was 4.2%, 280 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $1.81 billion. On the bottom line, the average EPS estimate is $0.80.

Next year's average estimate for revenue is $7.16 billion. The average EPS estimate is $2.81.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 350 members out of 377 rating the stock outperform, and 27 members rating it underperform. Among 94 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 86 give Owens-Illinois 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 Owens-Illinois is outperform, with an average price target of $29.70.

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This article was originally published as Owens-Illinois Beats on EPS But GAAP Results Lagon Fool.com

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