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Why Is Blackbaud (BLKB) Up 0.9% Since Last Earnings Report?

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It has been about a month since the last earnings report for Blackbaud (BLKB - Free Report) . Shares have added about 0.9% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Blackbaud 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 drivers.

Blackbaud Q2 Earnings Beat Estimates

Blackbaud delivered second-quarter 2021 non-GAAP earnings of 82 cents per share, which beat the Zacks Consensus Estimate by 18.8%. The bottom line decreased 3.5% year over year.

Total revenues dropped 1.1% year over year to $229.4 million but surpassed the consensus mark by 1.5%.

Quarter in Detail

Total recurring revenues for the reported quarter were $217 million and contributed 94.6% to total revenues. The figure inched up 0.3% due to tough year-over-year comparison for payments revenues.

Non-GAAP organic revenues were down 1.1% year over year. Non-GAAP organic revenues on a constant currency (CC) basis amounted to $225.1 million, down 3% year over year. Non-GAAP organic recurring revenues rose 0.3% year over year.

One-time services and other revenues (5.4% of total revenues) amounted to $12.5 million, down 20.8% year over year.

Recent Business Highlights

Blackbaud announced technology innovations specifically designed to support the unique needs of social organizations amid the COVID-19 outbreak, which may have improved the reputation of the company’s brand and enhanced recognition for its products.

Blackbaud announced the general availability of its latest solution — Payment Terminal. Payment Terminal will enable enterprises, mainly arts and cultural, to receive contactless payments made through chip-embedded credit cards.

Blackbaud rolled out its Blackbaud Peer-to-Peer Fundraising solution, powered by JustGiving, in Canada as well as Australia and New Zealand.

Higher adoption of Blackbaud’s new solutions is likely to drive top-line performance and boost retention among existing customers.

Margin Details

Non-GAAP gross margin came in at 59.1% compared with 60.4% reported in the prior-year quarter.

Total operating expenses were up 0.8% on a year-over-year basis to $108.3 million. As a percentage of revenues, the figure expanded 90 bps to 47.2%.

Non-GAAP operating margin expanded 10 basis points from the year-ago quarter’s figure to 23.6%.

Balance Sheet & Cash Flow

As on Jun 30, 2021, Blackbaud had total cash, cash equivalents and restricted cash of $462.9 million compared with $282.9 million as of Mar 31, 2021.

Total debt (including current portion) as of Jun 30, 2021 amounted to $544.9 million compared with $550.8 million as of Mar 31, 2021.

Cash provided by operating activities for three months ended Jun 30, 2021, was $69.8 million compared with $30.1 million for three months ended Mar 31, 2021.

Non-GAAP free cash flow for the second quarter was $56.6 million compared with $17.3 million of non-GAAP free cash flow in the previous quarter.

In the quarter under review, Blackbaud repurchased 405,047 shares worth $30 million. The company has shares worth $151 million left under its current buyback program of $250 million.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -30.56% due to these changes.

VGM Scores

Currently, Blackbaud has a nice Growth Score of B, a grade with the same score on the momentum front. Charting a somewhat similar path, 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 B. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been broadly trending downward for the stock, and the magnitude of these revisions 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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