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Why Is Dun & Bradstreet (DNB) Up 8.1% Since Its Last Earnings Report?

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It has been about a month since the last earnings report for Dun & Bradstreet Corporation (DNB - Free Report) . Shares have added about 8.1% in that time frame.

Will the recent positive trend continue leading up to its next earnings release, or is DNB due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Recent Earnings

Dun & Bradstreet reported fourth-quarter 2017 adjusted earnings of $3.22 per share, which beat the Zacks Consensus Estimate of $3.03 and increased 7.7% on a year-over-year basis.

On an adjusted basis and after including forex effect, total revenues came in at $528.3 million, up 2.2% year over year. On a GAAP basis, revenues were $527 million, up 1.9%. The Zacks Consensus Estimate was pegged at $537 million.

Quarter Details

Organic revenues came in at $512.9 million, up 0.5% (before effects of forex) year over year.

Region-wise, adjusted revenues (and after including forex effect) from the company’s Americas segment (85.1% of total) were up 2% year over year to $449.4 million while that from Non-Americas (14.9%) increased 4% to $78.9 million.

Segment-wise, on an adjusted basis and after including forex effect, Risk Management Solutions revenues from Americas decreased 1% year over year to $208 million. Nonetheless, Sales and Marketing Solutions revenues from the region grew 4.4% from the year-ago quarter to $241.4 million.

In Non-Americas, adjusted Risk Management Solutions revenues increased 1% year over year to $62 million. Sales and Marketing Solutions Non-Americas grew 16.6% from the year-ago quarter to $16.9 million.

Operating Details

On an adjusted basis, total operating costs remained flat at $336.4 million.

Adjusted total operating income was $191.9 million, up 6.2% year over year. Adjusted operating margin of 36.3% expanded 140 basis points (bps) from the year-ago quarter.

Balance Sheet & Cash Flow

As of Dec 31, 2017, the company’s cash and cash equivalents were $442.4 compared with $431 million as of Sep 30, 2017. Long-term debt was approximately $1.65 billion. The company’s net debt position as of Dec 31, 2017 was $1.24 billion.

For 2017, cash flow from operating activities was $286.5 million compared with $322.7 million in 2016. Free cash flow for 2017 was $224.4 million, down 15% year over year.

Guidance

Management expects D&B Credit suite revenues to remain flat (at a minimum) for 2018.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates. There have been three revisions higher for the current quarter.

VGM Scores

At this time, DNB has a subpar Growth Score of D, however its Momentum is doing a bit better with a C. The stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

The company's stock is suitable solely for momentum based on our styles scores.

Outlook

Estimates have been trending upward for the stock and the magnitude of these revisions looks promising. It comes with little surprise DNB has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.


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