Earnings Preview: Concur Technologies

Concur Technologies Inc. (CNQR - Analyst Report) is scheduled to report its fourth quarter and fiscal 2011 results on Tuesday November 15, 2011. The current Zacks Consensus Estimate for the quarter is 16 cents a share. For the quarter under review, revenue is $95 million, according to the Zacks Consensus Estimate.

Third-Quarter 2011, a Synopsis

Concur Technologies Inc. reported third-quarter fiscal 2011 earnings per share from continuing operations of $0.17, above the Zacks Consensus Estimate of $0.10. Prior-year earnings from continuing operation was $0.07.

Total revenue was $89.5 million, an increase of 19% year over year. A substantial portion of revenue was generated by the company from new customers, driven by an improved demand and expanded distribution network. Concur Technologies expects to see further increase in demand across all customer segments and geographies.

Third-Quarter 2011 Zacks Consensus

The analysts considered by Zacks, expect Concur to post fourth-quarter 2011 earnings of 16 cents a share. The current Zacks Consensus Estimate reflects an increase of 24.0% from the prior-year quarter’s earnings. The current Zacks Consensus Estimate for the quarter ranges between 14 cents and 24 cents a share.

Zacks Agreement & Magnitude

Among the analysts following the stock, only one analyst has raised the estimate projection in the last 30 days, therefore, the Zacks Consensus Estimate is stagnant at 16 cents.

Mixed Earnings Surprise History

With respect to earnings surprises, Concur Technologies has topped the Zacks Consensus Estimate in three of the last four quarters in the range of 8.3% to 90.0%. The average remained at positive 19.78%. This suggests that Concur Technologies has beaten the Zacks Consensus Estimate by an average of 19.78% in the trailing four quarters.

Zacks Rank

Concur Technologies is a provider of business services that automate the processes involved in the management of corporate expense. Concur focuses on reducing costly and inefficient expense processes in businesses of all sizes, by streamlining the reimbursement processes, reducing operating costs, improving internal controls, and enabling customers to apply greater insight into their spending patterns through analytics.

With an increasingly stronger balance sheet, Concur has the capacity to witness the organic growth of the business through selective acquisitions and investments. The company’s continued investments in innovation provide greater opportunity to participate in the travel and expense management process.

Further, valuable long-term drivers for the company include its investment in the emerging markets, its geographic expansion and customer retention (in which Concur leads the industry in client satisfaction).

However, the company faces significant competition in business travel and expense management market. There are thousands of third-party travel applications available today on the Apple App Store, and users are free to adopt and consume those applications. Also, the company is incurring huge costs in expanding its activity in the emerging businesses, but these investments are not expected to contribute meaningful revenue until 2012.

The company primarily competes with Commvault System (CVLT), BlackBaud Inc. (BLKB) and currently holds Zacks Rank # 3 which implies into short term ‘Hold’ rating.

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