Magellan Health Services Inc. (NASDAQ:MGLN) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 1.83%.
Magellan Health Services Inc. Earnings Cheat Sheet
Results: Adjusted Earnings Per Share increased 18.56% to $1.15 in the quarter versus EPS of $0.97 in the year-earlier quarter.
Revenue: Rose 4.62% to $842.7 million from the year-earlier quarter.
Actual vs. Wall St. Expectations: Magellan Health Services Inc. reported adjusted EPS income of $1.15 per share. By that measure, the company beat the mean analyst estimate of $1.01. It missed the average revenue estimate of $856.83 million.
Quoting Management: “I am pleased with Magellan’s strong second quarter performance and the strides we made in our growth initiatives,” said Barry M. Smith, chief executive officer. “This is a time of transformation at Magellan, as we build on the solid foundation developed over the past several years and evolve into a business with a sharp focus on leveraging our unique strengths, particularly with regard to managing special populations. We have developed our Magellan Complete Care and Magellan Pharmacy Solutions initiatives to address opportunities that we see in the marketplace and to be our primary growth engines for the future.
“Our core behavioral health, radiology and pharmacy businesses continue to perform well and are making significant contributions to our results. They have fueled our past growth and, going forward, will provide the clinical capabilities to holistically manage enrollees in our Magellan Complete Care programs. For example, our new health plan, Magellan Complete Care of Florida, which began enrolling members during the quarter, leverages the assets of our entire product portfolio. We are moving decisively to simplify and retool our offerings, sharpen our business focus and position the company for continued growth.”
Key Stats (on next page)…
Revenue increased 2.55% from $821.76 million in the previous quarter. EPS increased 13.86% from $1.01 in the previous quarter.
Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $1 to a profit $1.02. For the current year, the average estimate has moved up from a profit of $3.72 to a profit of $3.83 over the last ninety days.
Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.
(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)