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Blackbaud (BLKB) Down 9.3% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Blackbaud (BLKB - Free Report) . Shares have lost about 9.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Blackbaud due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Blackbaud Q4 Earnings Beat Estimates
Blackbaud, Inc. delivered fourth-quarter 2020 non-GAAP earnings of 85 cents per share, which beat the Zacks Consensus Estimate by 18.06%. The bottom line improved 66.7% year over year.
Total non-GAAP revenues increased 1.9% year over year to $242.6 million and surpassed the consensus mark by 6.4%.
Quarter in Detail
Total non-GAAP recurring revenues for the reported quarter were $229.5 million, and contributed 95% to total revenues. The figure increased 4.3% year over year.
Non-GAAP organic revenues improved 1.9% year over year to $242.6 million. Non-GAAP organic revenues on a constant currency (CC) basis amounted to $241.9 million, up 1.6% year over year.
Non-GAAP organic recurring revenues improved 4.3% year over year to $229.5 million.
One-time services and other revenues (5% of total revenues) amounted to $13.1 million, down 27% year over year.
Key Business Highlights
Blackbaud announced technology innovations specifically designed to support the unique needs of social organizations amid the COVID-19 outbreak, which may have enhanced the reputation of the company’s brand and enhanced recognition for its products.
The company introduced an updated marketplace in a bid to offer increased innovation to social good organizations.
The company also launched a formal Environmental, Social and Governance (ESG) program in order to support community needs.
Additionally, higher education and healthcare institutions worldwide are turning to Blackbaud solutions to power fundraisers for COVID-19 vaccines and lifesaving equipment.
Blackbaud’s Cloud Solution for Higher Education, which is aimed at aiding clientele to drive efficiency, increase revenues and deepen engagement during the pandemic, is witnessing traction across colleges and universities.
In fact, its end-to-end cloud solutions power 24 of the top 25 private U.S. colleges, per a ranking released by Forbes. Notably, the solutions facilitate students with admissions and advancement services, and fundraising and alumni engagement amid coronavirus crisis-led online learning wave.
Enhanced capabilities are anticipated to drive adoption of Blackbaud’s solutions in the days ahead and boost retention among existing customers.
Margin Details
Non-GAAP gross margin expanded 110 basis points (bps) to 57.1%.
Total operating expenses climbed 5.2% to $123.9 million. As a percentage of revenues, the figure expanded 40 bps to 54%.
Non-GAAP operating margin expanded 910 bps from the year-ago quarter’s figure to 24%.
Balance Sheet & Cash Flow
As on Dec 31, 2020, Blackbaud had total cash, cash equivalents and restricted cash of $645 million compared with $234.2 million as of Sep 30, 2020.
Total debt (including current portion) as of Dec 31 amounted to $531 million compared with $508.3 million as of Sep 30.
Cash provided by operating activities for 12 months ended Dec 31, 2020, was $148 million compared with $182.5 million for 12 months ended Dec 31, 2020.
Non-GAAP free cash flow for 12 months ended Dec 31, 2020 was $76.1 million compared with $124.1 million of free cash outflow for 12 months ended Dec 31, 2019.
In November 2020, Blackbaud’s board of directors reauthorized and expanded its existing share repurchase program to $250 million. Through Jan 31, 2021, the company has repurchased approximately 1.2 million shares worth $69 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -8.33% due to these changes.
VGM Scores
At this time, Blackbaud has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Blackbaud has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Blackbaud (BLKB) Down 9.3% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Blackbaud (BLKB - Free Report) . Shares have lost about 9.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Blackbaud due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Blackbaud Q4 Earnings Beat Estimates
Blackbaud, Inc. delivered fourth-quarter 2020 non-GAAP earnings of 85 cents per share, which beat the Zacks Consensus Estimate by 18.06%. The bottom line improved 66.7% year over year.
Total non-GAAP revenues increased 1.9% year over year to $242.6 million and surpassed the consensus mark by 6.4%.
Quarter in Detail
Total non-GAAP recurring revenues for the reported quarter were $229.5 million, and contributed 95% to total revenues. The figure increased 4.3% year over year.
Non-GAAP organic revenues improved 1.9% year over year to $242.6 million. Non-GAAP organic revenues on a constant currency (CC) basis amounted to $241.9 million, up 1.6% year over year.
Non-GAAP organic recurring revenues improved 4.3% year over year to $229.5 million.
One-time services and other revenues (5% of total revenues) amounted to $13.1 million, down 27% year over year.
Key Business Highlights
Blackbaud announced technology innovations specifically designed to support the unique needs of social organizations amid the COVID-19 outbreak, which may have enhanced the reputation of the company’s brand and enhanced recognition for its products.
The company introduced an updated marketplace in a bid to offer increased innovation to social good organizations.
The company also launched a formal Environmental, Social and Governance (ESG) program in order to support community needs.
Additionally, higher education and healthcare institutions worldwide are turning to Blackbaud solutions to power fundraisers for COVID-19 vaccines and lifesaving equipment.
Blackbaud’s Cloud Solution for Higher Education, which is aimed at aiding clientele to drive efficiency, increase revenues and deepen engagement during the pandemic, is witnessing traction across colleges and universities.
In fact, its end-to-end cloud solutions power 24 of the top 25 private U.S. colleges, per a ranking released by Forbes. Notably, the solutions facilitate students with admissions and advancement services, and fundraising and alumni engagement amid coronavirus crisis-led online learning wave.
Enhanced capabilities are anticipated to drive adoption of Blackbaud’s solutions in the days ahead and boost retention among existing customers.
Margin Details
Non-GAAP gross margin expanded 110 basis points (bps) to 57.1%.
Total operating expenses climbed 5.2% to $123.9 million. As a percentage of revenues, the figure expanded 40 bps to 54%.
Non-GAAP operating margin expanded 910 bps from the year-ago quarter’s figure to 24%.
Balance Sheet & Cash Flow
As on Dec 31, 2020, Blackbaud had total cash, cash equivalents and restricted cash of $645 million compared with $234.2 million as of Sep 30, 2020.
Total debt (including current portion) as of Dec 31 amounted to $531 million compared with $508.3 million as of Sep 30.
Cash provided by operating activities for 12 months ended Dec 31, 2020, was $148 million compared with $182.5 million for 12 months ended Dec 31, 2020.
Non-GAAP free cash flow for 12 months ended Dec 31, 2020 was $76.1 million compared with $124.1 million of free cash outflow for 12 months ended Dec 31, 2019.
In November 2020, Blackbaud’s board of directors reauthorized and expanded its existing share repurchase program to $250 million. Through Jan 31, 2021, the company has repurchased approximately 1.2 million shares worth $69 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -8.33% due to these changes.
VGM Scores
At this time, Blackbaud has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Blackbaud has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.