What Does Wall Street See for Shanda Games's Q1?

Shanda Games (Nasdaq: GAME  ) is expected to report Q1 earnings on May 23. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Shanda Games's revenues will contract -21.7% and EPS will shrink -27.3%.

The average estimate for revenue is $172.8 million. On the bottom line, the average EPS estimate is $0.16.

Revenue details
Last quarter, Shanda Games reported revenue of $172.1 million. GAAP reported sales were 19% lower than the prior-year quarter's $215.1 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $0.15. GAAP EPS of $0.12 for Q4 were 29% lower than the prior-year quarter's $0.17 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 65.4%, 390 basis points better than the prior-year quarter. Operating margin was 29.8%, 210 basis points worse than the prior-year quarter. Net margin was 19.8%, 260 basis points worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $743.0 million. The average EPS estimate is $0.69.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 300 members out of 311 rating the stock outperform, and 11 members rating it underperform. Among 38 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 31 give Shanda Games a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Shanda Games is outperform, with an average price target of $4.38.

Software and computerized services are being consumed in radically different ways, on new and increasingly mobile devices. Many old leaders will be left behind. Whether or not Shanda Games makes the coming cut, you should check out the company that Motley Fool analysts expect to lead the pack in "The Next Trillion-dollar Revolution." Click here for instant access to this free report.

Add Shanda Games to My Watchlist.