Why Tidewater (TDW) Is Losing Today

NEW YORK (TheStreet) -- Tidewater (TDW) was losing 9.6% to $45.64 Wednesday following an earnings report that fell short of analyst expectations.

In its fiscal third quarter Tidewater reported earnings of $1.01 a share. Analysts surveyed by Thomson Reuters expected earnings of $1.11 a share for the quarter. The company posted revenue of $365.3 million for the quarter that ended in December, compared to analyst expectations of $374 million.

The company's net earnings include a non-cash goodwill impairment charge of $56.3 million, which is part of Tidewater's annual goodwill impairment assessment.

TheStreet Ratings team rates TIDEWATER INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate TIDEWATER INC (TDW) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, increase in net income, attractive valuation levels and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • TDW's revenue growth has slightly outpaced the industry average of 8.1%. Since the same quarter one year prior, revenues rose by 17.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • TIDEWATER INC has improved earnings per share by 31.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, TIDEWATER INC increased its bottom line by earning $3.04 versus $1.72 in the prior year. This year, the market expects an improvement in earnings ($4.10 versus $3.04).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Energy Equipment & Services industry average. The net income increased by 31.0% when compared to the same quarter one year prior, rising from $41.36 million to $54.17 million.
  • 44.74% is the gross profit margin for TIDEWATER INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 14.72% is above that of the industry average.
  • You can view the full analysis from the report here: TDW Ratings Report