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Anaplan (PLAN) to Report Q3 Earnings: What's in the Cards?

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Anaplan is set to report third-quarter fiscal 2021 results on Nov 24.

Anaplan expects third-quarter revenues between $109 million and $110 million. The Zacks Consensus Estimate for revenues currently stands at $109.7 million, suggesting growth of 22.7% from the figure reported in the year-ago quarter.

For the quarter, the consensus mark for loss has been steady at 10 cents per share over the past 30 days. The company had reported loss of 8 cents in the year-ago quarter.

Notably, the company’s earnings beat the Zacks Consensus Estimate over the trailing four quarters, the average surprise being 42.5%.

Anaplan, Inc. Price and EPS Surprise

 

Anaplan, Inc. Price and EPS Surprise

Anaplan, Inc. price-eps-surprise | Anaplan, Inc. Quote

Let’s see how things have shaped up for this announcement.

Key Factors to Consider

Expansion of Anaplan’s user base is expected to have benefited its third-quarter performance. Solid demand for the company’s connected-planning solution, owing to the ongoing digital transformation among global enterprises, is expected to have aided the dollar-based network-expansion rate, which was 116% in the last-reported quarter.

However, the coronavirus-led disruption is expected to have hurt the momentum in the to-be-reported quarter.

Notably, at the end of fiscal second quarter, the company served 391 customers with more than $250K in annual recurring revenues, which reflected impressive year-over-year growth of 31%.

Moreover, the company’s user base is expected to have expanded due to the Anaplan – Deloitte alliance that continued to gain traction among enterprises. Anaplan also announced a multi-year deal with Shell Information Technology International BV to accelerate the latter’s digital transformation of business and finance processes.

Further, similar to its Zacks Internet-Software industry peer like HubSpot (HUBS - Free Report) Anaplan has been benefiting from a subscription-based business model. Anaplan’s second-quarter fiscal 2021 subscription revenues soared 32% year over year.

Notably, HubSpot’s subscription revenues grew 32% to $221.1 million and accounted for 96.8% of third-quarter 2020 total revenues.

Nevertheless, operating costs are expected to have increased due to the company’s go-to-market and technology-platform investments, thereby negatively impacting profitability.

Key Q3 Developments

During the quarter, Anaplan announced new integration offerings, modeling capabilities, and collaboration features for its cloud-based platform at the company’s annual Connected Planning Xperience conference.

The company also launched an intelligence framework called PlanIQ that integrates machine learning from Amazon Web Services’ Amazon Forecast managed service with its predictive algorithms.

Moreover, Anaplan and Alphabet’s (GOOGL - Free Report) Google Cloud announced a strategic partnership to offer the former’s platform for enterprise planning and business performance on Google Cloud.

Further, Anaplan was named a leader in Gartner’s 2020 Magic Quadrant for Cloud Financial Planning & Analysis Solutions for the fourth consecutive year.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Anaplan has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

A Key Stock to Consider

Here is a company worth considering from the same sector as our model shows that it has the right combination of elements to beat on earnings this reporting cycle:

Momo (MOMO - Free Report) has an Earnings ESP of +5.41% and is #3 Ranked. You can see the complete list of today’s Zacks #1 Rank stocks here.

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