Winmark Beats on Both Top and Bottom Lines

Winmark (Nasdaq: WINA  ) reported earnings on July 17. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended June 29 (Q2), Winmark beat slightly on revenues and beat expectations on earnings per share.

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

Gross margins were steady, operating margins expanded, net margins expanded.

Revenue details
Winmark reported revenue of $14.0 million. The one analyst polled by S&P Capital IQ looked for sales of $13.8 million on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $12.2 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 $0.83. The one earnings estimate compiled by S&P Capital IQ predicted $0.79 per share. GAAP EPS of $0.83 for Q2 were 28% higher than the prior-year quarter's $0.65 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 92.3%, much about the same as the prior-year quarter. Operating margin was 50.4%, 100 basis points better than the prior-year quarter. Net margin was 30.9%, 300 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $16.0 million. On the bottom line, the average EPS estimate is $1.02.

Next year's average estimate for revenue is $58.4 million. The average EPS estimate is $3.52.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 33 members out of 47 rating the stock outperform, and 14 members rating it underperform. Among 15 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), nine give Winmark a green thumbs-up, and six give it a red thumbs-down.

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