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ServiceMaster (SERV) Misses on Q1 Earnings, Withdraws View
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ServiceMaster Global Holdings (SERV - Free Report) reported disappointing first-quarter 2020 results wherein earnings and revenues missed the Zacks Consensus Estimate.
Adjusted EPS of 8 cents came below the consensus mark by 55.6% and decreased year over year. Revenues of $456 million missed the consensus mark by 0.4%.
Revenues in Detail
Terminix revenues of $438 million increased 5% year over year.
Revenues from European Pest Control and Other came in at $18 million in the reported quarter, backed by contributions from Nomor in Sweden and Norway as well as Terminix U.K. business.
Revenues from the ServiceMaster Brands Divestiture Group came in at $65 million, up 3% year over year. The uptick was driven by revenue growth in national accounts and owned branch operations, which partially offset revenue declines in royalty fees in the period. Decline in area-wide events year over year in ServiceMaster Restore and coronavirus-related shutdown of Merry Maids locations (during late March) weighed on royalty revenues.
ServiceMaster Global Holdings Inc Price, Consensus and EPS Surprise
Adjusted EBITDA of $60 million went down 27.7% year over year. Adjusted EBITDA margin of 13.1% declined 660 basis points year over year.
The company exited the quarter with cash and cash equivalent balance of $185 million compared with $280 million at the end of prior quarter. Long-term debt was $1.62 billion compared with $1.67 billion at the end of prior quarter.
The company generated $55 million of cash from operating activities. Free cash flow came in at $45 million. It repurchased $103 million of shares in the quarter.
2020 Outlook
Considering the current uncertainty prevailing in the market due to the coronavirus outbreak, ServiceMaster withdrew its 2020 guidance.
S&P Global Inc. (SPGI - Free Report) first-quarter 2020 adjusted earnings per share of $2.73 beat the consensus mark by 15.7% and improved 29.4% year over year on the back of revenue growth, benefits of productivity initiatives and reduced business travel. The stock currently carries a Zacks Rank #3.
IQVIA Holdings Inc. (IQV - Free Report) first-quarter 2020 adjusted earnings per share of $1.50 beat the consensus mark by 1.4% but decreased 1.9% on a year-over-year basis. The reported figure lies within the guided range of $1.46-$1.51. The stock currently carries a Zacks Rank #3.
Insperity, Inc. (NSP - Free Report) first-quarter 2020 adjusted earnings of $1.70 per share beat the consensus mark by 5.6% but decreased 14.1% year over year. The reported figure matched the higher end of the guided range of $1.61-$1.70. The stock currently carries a Zacks Rank #3.
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This young company’s gigantic growth was hidden by low-volume trading, then cut short by the coronavirus. But its digital products stand out in a region where the internet economy has tripled since 2015 and looks to triple again by 2025.
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ServiceMaster (SERV) Misses on Q1 Earnings, Withdraws View
ServiceMaster Global Holdings (SERV - Free Report) reported disappointing first-quarter 2020 results wherein earnings and revenues missed the Zacks Consensus Estimate.
Adjusted EPS of 8 cents came below the consensus mark by 55.6% and decreased year over year. Revenues of $456 million missed the consensus mark by 0.4%.
Revenues in Detail
Terminix revenues of $438 million increased 5% year over year.
Revenues from European Pest Control and Other came in at $18 million in the reported quarter, backed by contributions from Nomor in Sweden and Norway as well as Terminix U.K. business.
Revenues from the ServiceMaster Brands Divestiture Group came in at $65 million, up 3% year over year. The uptick was driven by revenue growth in national accounts and owned branch operations, which partially offset revenue declines in royalty fees in the period. Decline in area-wide events year over year in ServiceMaster Restore and coronavirus-related shutdown of Merry Maids locations (during late March) weighed on royalty revenues.
ServiceMaster Global Holdings Inc Price, Consensus and EPS Surprise
ServiceMaster Global Holdings Inc price-consensus-eps-surprise-chart | ServiceMaster Global Holdings Inc Quote
Other Quarterly Numbers
Adjusted EBITDA of $60 million went down 27.7% year over year. Adjusted EBITDA margin of 13.1% declined 660 basis points year over year.
The company exited the quarter with cash and cash equivalent balance of $185 million compared with $280 million at the end of prior quarter. Long-term debt was $1.62 billion compared with $1.67 billion at the end of prior quarter.
The company generated $55 million of cash from operating activities. Free cash flow came in at $45 million. It repurchased $103 million of shares in the quarter.
2020 Outlook
Considering the current uncertainty prevailing in the market due to the coronavirus outbreak, ServiceMaster withdrew its 2020 guidance.
Currently, ServiceMaster carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
S&P Global Inc. (SPGI - Free Report) first-quarter 2020 adjusted earnings per share of $2.73 beat the consensus mark by 15.7% and improved 29.4% year over year on the back of revenue growth, benefits of productivity initiatives and reduced business travel. The stock currently carries a Zacks Rank #3.
IQVIA Holdings Inc. (IQV - Free Report) first-quarter 2020 adjusted earnings per share of $1.50 beat the consensus mark by 1.4% but decreased 1.9% on a year-over-year basis. The reported figure lies within the guided range of $1.46-$1.51. The stock currently carries a Zacks Rank #3.
Insperity, Inc. (NSP - Free Report) first-quarter 2020 adjusted earnings of $1.70 per share beat the consensus mark by 5.6% but decreased 14.1% year over year. The reported figure matched the higher end of the guided range of $1.61-$1.70. The stock currently carries a Zacks Rank #3.
Zacks’ Single Best Pick to Double
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This young company’s gigantic growth was hidden by low-volume trading, then cut short by the coronavirus. But its digital products stand out in a region where the internet economy has tripled since 2015 and looks to triple again by 2025.
Its stock price is already starting to resume its upward arc. The sky’s the limit! And the earlier you get in, the greater your potential gain.
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