Neogen Misses Where it Counts

Neogen (Nasdaq: NEOG  ) reported earnings on March 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 28 (Q3), Neogen beat slightly on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue grew. GAAP earnings per share grew significantly.

Margins expanded across the board.

Revenue details
Neogen booked revenue of $51.1 million. The three analysts polled by S&P Capital IQ expected to see net sales of $50.5 million on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $44.9 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 $0.27. The two earnings estimates compiled by S&P Capital IQ forecast $0.28 per share. GAAP EPS of $0.27 for Q3 were 23% higher than the prior-year quarter's $0.22 per share.

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 53.5%, 250 basis points better than the prior-year quarter. Operating margin was 18.9%, 210 basis points better than the prior-year quarter. Net margin was 13.0%, 130 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $54.5 million. On the bottom line, the average EPS estimate is $0.31.

Next year's average estimate for revenue is $206.3 million. The average EPS estimate is $1.13.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 245 members out of 254 rating the stock outperform, and nine members rating it underperform. Among 61 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 61 give Neogen a green thumbs-up, and give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Neogen is outperform, with an average price target of $51.00.

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