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Headwaters Misses Where it Counts

Tuesday - 4/30/2013, 2:00am  ET

Headwaters reported earnings on April 30. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q2), Headwaters beat expectations on revenues and missed expectations on earnings per share.

Compared to the prior-year quarter, revenue increased. Non-GAAP loss per share dropped. GAAP loss per share dropped.

Gross margins contracted, operating margins were steady, net margins grew.

Revenue details
Headwaters notched revenue of $141.0 million. The four analysts polled by S&P Capital IQ predicted a top line of $137.3 million on the same basis. GAAP reported sales were 8.8% higher than the prior-year quarter's $129.6 million.

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 -$0.14. The four earnings estimates compiled by S&P Capital IQ predicted -$0.11 per share. Non-GAAP EPS were -$0.14 for Q2 against -$0.29 per share for the prior-year quarter. GAAP EPS were -$0.11 for Q2 against -$0.34 per share for the prior-year quarter.

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 23.0%, 130 basis points worse than the prior-year quarter. Operating margin was -0.8%, much about the same as the prior-year quarter. Net margin was -5.9%, 1,000 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $202.5 million. On the bottom line, the average EPS estimate is $0.18.

Next year's average estimate for revenue is $705.6 million. The average EPS estimate is $0.24.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 735 members out of 807 rating the stock outperform, and 72 members rating it underperform. Among 178 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 160 give Headwaters a green thumbs-up, and 18 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Headwaters is buy, with an average price target of $12.75.

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This article was originally published as Headwaters Misses Where it Countson Fool.com

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