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Apart from a favorable rank, Blackbaud has a VGM Score of B. Per Zacks’ proprietary methodology, stocks with a combination of a Zacks Rank #1 or #2 and a VGM Score of A or B offer solid investment opportunities.
The stock is down 10.4% from its 52-week high level of $65.40 reached on Jun 02, 2022, making it more affordable for investors. The stock has lost 6% in the past year compared with the sub-industry’s decline of 8.7%.
Image Source: Zacks Investment Research
Blackbaud has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average earnings surprise of 6.2%. The stock has long-term earnings per share growth expectation of 10.4%.
The Zacks Consensus Estimate for earnings per share for 2023 and 2024 is pegged at $3.39 and $3.89, up 26% and 14.7%, respectively, year over year. The Zacks Consensus Estimate for revenues for 2023 and 2024 is pegged at $1.09 billion and $1.15 billion, representing year-over-year growth of 2.9% and 5.2%, respectively.
A Look at Fundamental Drivers
Headquartered in Charleston, SC, Blackbaud is a well-known cloud software company. It offers a full spectrum of cloud-based and on-premise software solutions and related services for organizations of all sizes, especially social good organizations.
Blackbaud's cloud-based suite of applications demonstrates strong growth momentum, driven by the transition of organizations from the traditional revenue-based model to the cloud-based subscription model.
Frequent product launches and synergies from recent acquisitions bode well. The acquisition of EVERFI has helped the company to expand its total addressable market by about two times. In January 2022, the company acquired EVERFI in a cash-and-stock deal worth $750 million.
EVERFI provides an Impact-as-a-Service solution and digital educational content. The acquisition also provides cross-selling and upselling opportunities with Blackbaud’s YourCause solution.
The company’s extensive cost control measures augur well along with strong bookings and pipeline coverage.
In the last reported quarter, Blackbaud’s total revenues increased 10.8% year over year to $274.8 million. The top line was driven by strength in recurring revenues.
For 2023, Blackbaud expects non-GAAP revenues between $1.08 billion and $1.11 billion. The company projects a non-GAAP adjusted EBITDA margin in the range of 29.5-30.5%.
Non-GAAP earnings per share are expected to be between $3.30 and $3.60. Non-GAAP adjusted free cash flow for the year is forecast in the range of $170-$190 million.
However, uncertainty prevailing over global macroeconomic conditions and rising inflation are major headwinds.
A leveraged balance sheet adds to the risk of investing in the company. As of Dec 31, 2022, Blackbaud had total cash and cash equivalents of $733.4 million, while total debt (including the current portion) amounted to $859 million. BLKB had suspended dividend payouts to maintain near-term liquidity amid the COVID-19 crisis in 2020.
Other Stocks to Consider
Some other top-ranked stocks in the broader technology space are Arista Networks (ANET - Free Report) , Perion Network (PERI - Free Report) and Pegasystems (PEGA - Free Report) , each presently sports a Zacks Rank #1.
The Zacks Consensus Estimate for Arista Networks 2023 earnings is pegged at $5.76 per share, rising 11% in the past 60 days. The long-term earnings growth rate is anticipated to be 14.2%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 14.2%. Shares of ANET have increased 9.8% in the past year.
The Zacks Consensus Estimate for Perion’s 2023 earnings is pegged at $2.69 per share, rising 16% in the past 60 days. The long-term earnings growth rate is anticipated to be 25%.
Perion’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 31.7%. Shares of PERI have increased 53% in the past year.
The Zacks Consensus Estimate for Pegasystem’s 2023 earnings is pegged at 84 cents per share, rising 35.5% in the past 60 days.
Pegasystem’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, the average surprise being 11.2%. Shares of the company have declined 41.5% in the past year.
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Here's Why Investors Should Bet on Blackbaud (BLKB) Stock
Amid the ongoing volatility, Blackbaud (BLKB - Free Report) is a stock that investors may consider adding to their portfolio to make some gains from its upside potential. The company currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Apart from a favorable rank, Blackbaud has a VGM Score of B. Per Zacks’ proprietary methodology, stocks with a combination of a Zacks Rank #1 or #2 and a VGM Score of A or B offer solid investment opportunities.
The stock is down 10.4% from its 52-week high level of $65.40 reached on Jun 02, 2022, making it more affordable for investors. The stock has lost 6% in the past year compared with the sub-industry’s decline of 8.7%.
Image Source: Zacks Investment Research
Blackbaud has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average earnings surprise of 6.2%. The stock has long-term earnings per share growth expectation of 10.4%.
The Zacks Consensus Estimate for earnings per share for 2023 and 2024 is pegged at $3.39 and $3.89, up 26% and 14.7%, respectively, year over year. The Zacks Consensus Estimate for revenues for 2023 and 2024 is pegged at $1.09 billion and $1.15 billion, representing year-over-year growth of 2.9% and 5.2%, respectively.
A Look at Fundamental Drivers
Headquartered in Charleston, SC, Blackbaud is a well-known cloud software company. It offers a full spectrum of cloud-based and on-premise software solutions and related services for organizations of all sizes, especially social good organizations.
Blackbaud's cloud-based suite of applications demonstrates strong growth momentum, driven by the transition of organizations from the traditional revenue-based model to the cloud-based subscription model.
Frequent product launches and synergies from recent acquisitions bode well. The acquisition of EVERFI has helped the company to expand its total addressable market by about two times. In January 2022, the company acquired EVERFI in a cash-and-stock deal worth $750 million.
EVERFI provides an Impact-as-a-Service solution and digital educational content. The acquisition also provides cross-selling and upselling opportunities with Blackbaud’s YourCause solution.
The company’s extensive cost control measures augur well along with strong bookings and pipeline coverage.
In the last reported quarter, Blackbaud’s total revenues increased 10.8% year over year to $274.8 million. The top line was driven by strength in recurring revenues.
For 2023, Blackbaud expects non-GAAP revenues between $1.08 billion and $1.11 billion. The company projects a non-GAAP adjusted EBITDA margin in the range of 29.5-30.5%.
Non-GAAP earnings per share are expected to be between $3.30 and $3.60. Non-GAAP adjusted free cash flow for the year is forecast in the range of $170-$190 million.
However, uncertainty prevailing over global macroeconomic conditions and rising inflation are major headwinds.
A leveraged balance sheet adds to the risk of investing in the company. As of Dec 31, 2022, Blackbaud had total cash and cash equivalents of $733.4 million, while total debt (including the current portion) amounted to $859 million. BLKB had suspended dividend payouts to maintain near-term liquidity amid the COVID-19 crisis in 2020.
Other Stocks to Consider
Some other top-ranked stocks in the broader technology space are Arista Networks (ANET - Free Report) , Perion Network (PERI - Free Report) and Pegasystems (PEGA - Free Report) , each presently sports a Zacks Rank #1.
The Zacks Consensus Estimate for Arista Networks 2023 earnings is pegged at $5.76 per share, rising 11% in the past 60 days. The long-term earnings growth rate is anticipated to be 14.2%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 14.2%. Shares of ANET have increased 9.8% in the past year.
The Zacks Consensus Estimate for Perion’s 2023 earnings is pegged at $2.69 per share, rising 16% in the past 60 days. The long-term earnings growth rate is anticipated to be 25%.
Perion’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 31.7%. Shares of PERI have increased 53% in the past year.
The Zacks Consensus Estimate for Pegasystem’s 2023 earnings is pegged at 84 cents per share, rising 35.5% in the past 60 days.
Pegasystem’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, the average surprise being 11.2%. Shares of the company have declined 41.5% in the past year.