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Bull of the Day: Everbridge (EVBG)
Everbridge (EVBG - Free Report) is a $1.3 billion provider of software communications and enterprise safety applications. After a strong beat and raise quarter reported in late February, analysts have significantly raised EPS estimates, looking for 124% growth this year and still +23% in 2024.
Everbridge applications include Mass Notification, Incident Management, IT Alerting, Safety Connection(TM), Community Engagement(TM), Secure Messaging and Internet of Things. It operates primarily in Boston, Los Angeles, San Francisco, Beijing and London.
Everbridge delivered quarterly earnings of $0.39 per share, beating the Zacks Consensus Estimate of $0.31 per share. This compares to loss of $0.05 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of 25.81%. A quarter ago, it was expected that this software developer would post earnings of $0.17 per share when it actually produced earnings of $0.27, delivering a surprise of 58.82%. Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Everbridge, which belongs to the Zacks Internet - Software industry, posted revenues of $117.13 million for the quarter ended December 2022, surpassing the Zacks Consensus Estimate by 0.85%. This compares to year-ago revenues of $102.83 million. The company has topped consensus revenue estimates four times over the last four quarters.
Outlook and Guidance
Everbridge management sees FY23 EPS of 1.48-$1.52, vs the February consensus of $1.36, and FY23 revenue of $456.0M-$462.0M, vs. consensus of $457.69M. This makes the stock a relative bargain in Software on a price-to-sales basis of just 2.8 times vs. an industry range of 5-10X.
"The fourth quarter marked a strong finish to the year as we laid the groundwork for future growth and increased profitability," said David Wagner, Everbridge's President and CEO. "We delivered another steady sequential increase in ARR and solid growth in our adjusted EBITDA. In the fourth quarter we took meaningful steps forward to strengthen the company on our way to $1B in ARR."
Annual Recurring Revenue (ARR) is a key metric for Software companies as their large enterprise customers place quarterly contract subscriptions for multiple years.
Here was an analyst boosting his view after the report...
Stephens analyst Brian Colley raised his price target on Everbridge to $41 from $38 and kept an Overweight rating on the shares after the company reported Q4 results that exceeded expectations and posted what the firm calls out as "the strongest quarterly gross retention rate in greater than 2 years."
"Everbridge is showing encouraging progress on its strategic initiatives and profitability is inflecting meaningfully higher," wrote Colley.
Bottom line on Everbridge: Trading under 3X sales, and executing on its strategic goals toward $1 billion in ARR, EVBG shares are a relative Software value near $30.