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BGC Partners (BGCP) Q4 Earnings Meet Estimates, Stock Down 1.7%
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Shares of BGC Partners, Inc. lost 1.7% following the release of fourth-quarter and full-year 2021 results. Adjusted earnings of 17 cents per share were in line with the Zacks Consensus Estimate. The bottom line compared favorably with the prior-year quarter’s earnings of 13 cents.
Lower revenues and an increase in expenses were the major headwinds. However, a robust liquidity position and rise in net other income acted as tailwinds.
Net income available to common stockholders was $76.5 million, marking a significant improvement from a net loss of $4 million recorded in the prior-year quarter.
In 2021, adjusted earnings per share of 65 cents matched the consensus estimate and were up 14% year over year. Net income available to common stockholders came in at $124 million, up substantially from $45.1 million in 2020.
Revenues Down, Costs Rise
Total revenues in the reported quarter were $461.6 million, down 3.7% year over year. This fall was mainly due to lower total brokerage revenues. Also, the top line lagged the Zacks Consensus Estimate of $486 million.
In 2021, total revenues declined 2% to $2.02 billion. Also, the top line missed the Zacks Consensus Estimate of $2.04 billion.
Quarterly total expenses were $679.7 million, up 34.6% year over year. This rise was largely due to an increase in total compensation and employee benefits costs.
Total net other income was $322.9 million, up from $3.4 million recorded in the year-ago quarter.
Solid Balance Sheet
As of Dec 31, 2021, BGC Partners had cash and cash equivalents of $553.6 million, down from $596.3 million recorded as of Dec 31, 2020. Total assets were $3.3 billion compared with $4 billion as of Dec 31, 2020.
Total stockholders’ equity as of Dec 31, 2021, was $619.8 million, down 17.8% from the prior quarter-end.
Share Repurchase Update
During the reported quarter, BGC Partners repurchased 26.3 million for its Class A common shares.
First-Quarter 2022 Outlook
Revenues are expected to be in the range of $490-$540 million.
Pre-tax adjusted earnings are expected to be $105-$125 million.
Our View
BGC Partners has been restructuring its operations to better align with customer needs and automate operations. In sync with this, it divested the Insurance Brokerage business for gross proceeds of $535 million.
Additionally, it has been expanding its cryptocurrency offerings. BGC Partner plans to launch additional cryptocurrency and digital asset trading products throughout the year. The company intends to capitalize on the growing cryptocurrency opportunity.
BGC Partners, Inc. Price, Consensus and EPS Surprise
Hercules Capital, Inc. (HTGC - Free Report) is scheduled to announce quarterly numbers on Feb 22.
Over the past 30 days, the Zacks Consensus Estimate for Hercules Capital has been unchanged at 33 cents. This indicates a fall of 10.8% from the prior-year quarter reported number.
FS KKR Capital Corp. (FSK - Free Report) is slated to announce quarterly numbers on Feb 28.
Over the past 30 days, the Zacks Consensus Estimate for FS KKR Capital’s quarterly earnings has been unchanged at 62 cents, implying a 13.9% decline from the prior-year reported number.
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BGC Partners (BGCP) Q4 Earnings Meet Estimates, Stock Down 1.7%
Shares of BGC Partners, Inc. lost 1.7% following the release of fourth-quarter and full-year 2021 results. Adjusted earnings of 17 cents per share were in line with the Zacks Consensus Estimate. The bottom line compared favorably with the prior-year quarter’s earnings of 13 cents.
Lower revenues and an increase in expenses were the major headwinds. However, a robust liquidity position and rise in net other income acted as tailwinds.
Net income available to common stockholders was $76.5 million, marking a significant improvement from a net loss of $4 million recorded in the prior-year quarter.
In 2021, adjusted earnings per share of 65 cents matched the consensus estimate and were up 14% year over year. Net income available to common stockholders came in at $124 million, up substantially from $45.1 million in 2020.
Revenues Down, Costs Rise
Total revenues in the reported quarter were $461.6 million, down 3.7% year over year. This fall was mainly due to lower total brokerage revenues. Also, the top line lagged the Zacks Consensus Estimate of $486 million.
In 2021, total revenues declined 2% to $2.02 billion. Also, the top line missed the Zacks Consensus Estimate of $2.04 billion.
Quarterly total expenses were $679.7 million, up 34.6% year over year. This rise was largely due to an increase in total compensation and employee benefits costs.
Total net other income was $322.9 million, up from $3.4 million recorded in the year-ago quarter.
Solid Balance Sheet
As of Dec 31, 2021, BGC Partners had cash and cash equivalents of $553.6 million, down from $596.3 million recorded as of Dec 31, 2020. Total assets were $3.3 billion compared with $4 billion as of Dec 31, 2020.
Total stockholders’ equity as of Dec 31, 2021, was $619.8 million, down 17.8% from the prior quarter-end.
Share Repurchase Update
During the reported quarter, BGC Partners repurchased 26.3 million for its Class A common shares.
First-Quarter 2022 Outlook
Revenues are expected to be in the range of $490-$540 million.
Pre-tax adjusted earnings are expected to be $105-$125 million.
Our View
BGC Partners has been restructuring its operations to better align with customer needs and automate operations. In sync with this, it divested the Insurance Brokerage business for gross proceeds of $535 million.
Additionally, it has been expanding its cryptocurrency offerings. BGC Partner plans to launch additional cryptocurrency and digital asset trading products throughout the year. The company intends to capitalize on the growing cryptocurrency opportunity.
BGC Partners, Inc. Price, Consensus and EPS Surprise
BGC Partners, Inc. price-consensus-eps-surprise-chart | BGC Partners, Inc. Quote
Currently, BGC Partners carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Dates Other Finance Stocks
Hercules Capital, Inc. (HTGC - Free Report) is scheduled to announce quarterly numbers on Feb 22.
Over the past 30 days, the Zacks Consensus Estimate for Hercules Capital has been unchanged at 33 cents. This indicates a fall of 10.8% from the prior-year quarter reported number.
FS KKR Capital Corp. (FSK - Free Report) is slated to announce quarterly numbers on Feb 28.
Over the past 30 days, the Zacks Consensus Estimate for FS KKR Capital’s quarterly earnings has been unchanged at 62 cents, implying a 13.9% decline from the prior-year reported number.