DST Systems Crushes Earnings Estimates

DST Systems (NYSE: DST  ) reported earnings on Jan. 31. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), DST Systems beat expectations on revenues and crushed expectations on earnings per share.

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

Margins dropped across the board.

Revenue details
DST Systems logged revenue of $487.0 million. The four analysts polled by S&P Capital IQ predicted net sales of $471.9 million on the same basis. GAAP reported sales were 5.6% higher than the prior-year quarter's $623.4 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 $1.19. The five earnings estimates compiled by S&P Capital IQ anticipated $0.98 per share. GAAP EPS of $0.82 for Q4 were 5.7% lower than the prior-year quarter's $0.87 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 15.0%, 720 basis points worse than the prior-year quarter. Operating margin was -0.1%, 950 basis points worse than the prior-year quarter. Net margin was 5.8%, 50 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $468.3 million. On the bottom line, the average EPS estimate is $1.02.

Next year's average estimate for revenue is $1.88 billion. The average EPS estimate is $4.34.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 116 members out of 124 rating the stock outperform, and eight members rating it underperform. Among 43 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 42 give DST Systems a green thumbs-up, and one give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on DST Systems is outperform, with an average price target of $65.00.

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