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Dril-Quip (DRQ) Disappoints in Q1: Earnings & Revenues Lag

Dril-Quip Inc.DRQ , the manufacturer of offshore drilling and production equipment, reported first-quarter 2016 adjusted earnings of 83 cents per share, missing the Zacks Consensus Estimate of 85 cents. Also, quarterly earnings decreased from $1.26 reported a year ago.

The reported results were favorably impacted by an after-tax foreign exchange gain of $5.4 million, or 14 cents per diluted share, compared with an after-tax foreign exchange gain of $4.8 million, or 12 cents per diluted share, in the first quarter of 2015.

Dril-Quip Inc. (DRQ) Street EPS & Surprise Percent - Last 5 Quarters | FindTheCompany

The company registered total revenue of $166.6 million in the quarter, down from the year-ago level of $226.0 million. The reported figure also came in below the Zacks Consensus Estimate of $167.0 million.

Operating income of approximately $49.3 million was down from the year-earlier level of almost $71.7 million.

On the cost front, selling, general and administrative expenses fell from the year-earlier level of approximately $17.0 million to approximately $13.2 million. Engineering and product development costs decreased 10.7% year over year.

Backlog

As of Mar 31, 2016, the company had a backlog of $522 million compared with its Mar 31, 2015 backlog of approximately $1.1 billion.

Outlook

Dril-Quip plans to continue its strategy of investing counter cyclically through the pursuit of attractive acquisition candidates, the repurchase of stock through the share buy-back program and research and development efforts to benefit the company in the long term.

The company expects earnings per diluted share for the second quarter of 2016 in the range of 60 cents to 70 cents. For full-year 2016, the company expects earnings per diluted share in the range of $2.45 to $2.65.

Zacks Rank

Currently, Dril-Quip carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the same space are ReneSola Ltd. SOL , Seadrill Partners LLC SDLP and Braskem S.A. BAK . Each of these stocks sports a Zacks Rank #1 (Strong Buy).

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DRIL-QUIP INC (DRQ): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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