AFC Enterprises Beats on Revenue, Matches Expectations on EPS

AFC Enterprises (Nasdaq: AFCE  ) reported earnings on May 29. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended April 21 (Q1), AFC Enterprises beat expectations on revenues and met expectations on earnings per share.

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

Gross margins grew, operating margins dropped, net margins increased.

Revenue details
AFC Enterprises recorded revenue of $60.4 million. The three analysts polled by S&P Capital IQ foresaw revenue of $59.1 million on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $52.8 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 $0.40. The four earnings estimates compiled by S&P Capital IQ averaged $0.40 per share. GAAP EPS of $0.40 for Q1 were 18% higher than the prior-year quarter's $0.34 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 68.2%, 20 basis points better than the prior-year quarter. Operating margin was 26.8%, 10 basis points worse than the prior-year quarter. Net margin was 15.9%, 20 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $45.3 million. On the bottom line, the average EPS estimate is $0.31.

Next year's average estimate for revenue is $200.9 million. The average EPS estimate is $1.39.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 73 members out of 90 rating the stock outperform, and 17 members rating it underperform. Among 25 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 21 give AFC Enterprises a green thumbs-up, and four give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on AFC Enterprises is outperform, with an average price target of $36.38.

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