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Dr. Reddy's Laboratories Beats on Both Top and Bottom Lines

Wednesday - 5/15/2013, 2:00am  ET

Dr. Reddy's Laboratories reported earnings on May 14. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q4), Dr. Reddy's Laboratories beat expectations on revenues and beat expectations on earnings per share.

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

Gross margins contracted, operating margins grew, net margins increased.

Revenue details
Dr. Reddy's Laboratories reported revenue of $615.1 million. The 16 analysts polled by S&P Capital IQ expected to see revenue of $562.4 million on the same basis. GAAP reported sales were 18% higher than the prior-year quarter's $522.3 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 $0.62. The two earnings estimates compiled by S&P Capital IQ predicted $0.57 per share. GAAP EPS of $0.62 for Q4 were 55% higher than the prior-year quarter's $0.40 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 50.4%, 220 basis points worse than the prior-year quarter. Operating margin was 22.2%, 240 basis points better than the prior-year quarter. Net margin was 17.1%, 420 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $547.7 million. On the bottom line, the average EPS estimate is $0.41.

Next year's average estimate for revenue is $2.33 billion. The average EPS estimate is $2.01.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 479 members out of 504 rating the stock outperform, and 25 members rating it underperform. Among 102 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 99 give Dr. Reddy's Laboratories a green thumbs-up, and three give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Dr. Reddy's Laboratories is outperform, with an average price target of $37.69.

This article was originally published as Dr. Reddy's Laboratories Beats on Both Top and Bottom Lineson Fool.com

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