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Why Is Blackbaud (BLKB) Down 4.1% Since Last Earnings Report?
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A month has gone by since the last earnings report for Blackbaud (BLKB - Free Report) . Shares have lost about 4.1% in that time frame, outperforming 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 Top Estimates, Revenues Rise Y/Y
Blackbaud reported non-GAAP earnings of 68 cents per share in fourth-quarter 2022, which surpassed the Zacks Consensus Estimate by 17.2%. The bottom line declined 9.3% year over year.
Total revenues increased 10.8% year over year to $274.8 million but missed the Zacks Consensus Estimate by 0.8%. The top line was driven by strength in recurring revenues.
Total recurring revenues in the reported quarter amounted to $265.2 million, up 11% and contributed 96.5% to total revenues. One-time services and other revenues (3.5% of total revenues) amounted to $9.6 million, increasing 3% year over year.
Non-GAAP organic revenues were $278.4 million, up 0.4% on a reported basis and 1.7% on a constant-currency basis, year over year. Non-GAAP organic recurring revenues rose 1.3% year over year.
Margin Details
Non-GAAP gross margin came in at 56.7%, up 140 basis points (bps) from the prior-year quarter’s levels.
Total operating expenses were up 18.7% on a year-over-year basis to $154.8 million. As a percentage of revenues, the figure expanded 370 bps to 56.3%. Non-GAAP operating margin expanded 20 bps from the year-ago quarter’s figure to 20%.
Non-GAAP adjusted EBITDA margin came in at 24.7%, up 20 bps year over year.
Balance Sheet & Cash Flow
As of Dec 31, 2022, Blackbaud had total cash, cash equivalents and restricted cash of $733.9 million compared with $375.4 million as of Sep 30, 2022.
Total debt (including the current portion) as of Dec 31, 2022, amounted to $859 million compared with $854.1 million as of Sep 30, 2022.
Cash provided by operating activities in the three months ended Dec 31, 2022, was $14.1 million compared with $43.9 million in the prior-year period.
Non-GAAP adjusted free cash flow in the fourth quarter was $7.6 million compared with $31.9 million in the previous-year quarter.
2023 Guidance
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.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
At this time, Blackbaud has an average Growth Score of C, a grade with the same score on the momentum front. 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 upward for the stock, and the magnitude of these revisions indicates a downward shift. It comes with little surprise Blackbaud has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is Blackbaud (BLKB) Down 4.1% Since Last Earnings Report?
A month has gone by since the last earnings report for Blackbaud (BLKB - Free Report) . Shares have lost about 4.1% in that time frame, outperforming 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 Top Estimates, Revenues Rise Y/Y
Blackbaud reported non-GAAP earnings of 68 cents per share in fourth-quarter 2022, which surpassed the Zacks Consensus Estimate by 17.2%. The bottom line declined 9.3% year over year.
Total revenues increased 10.8% year over year to $274.8 million but missed the Zacks Consensus Estimate by 0.8%. The top line was driven by strength in recurring revenues.
Total recurring revenues in the reported quarter amounted to $265.2 million, up 11% and contributed 96.5% to total revenues. One-time services and other revenues (3.5% of total revenues) amounted to $9.6 million, increasing 3% year over year.
Non-GAAP organic revenues were $278.4 million, up 0.4% on a reported basis and 1.7% on a constant-currency basis, year over year. Non-GAAP organic recurring revenues rose 1.3% year over year.
Margin Details
Non-GAAP gross margin came in at 56.7%, up 140 basis points (bps) from the prior-year quarter’s levels.
Total operating expenses were up 18.7% on a year-over-year basis to $154.8 million. As a percentage of revenues, the figure expanded 370 bps to 56.3%.
Non-GAAP operating margin expanded 20 bps from the year-ago quarter’s figure to 20%.
Non-GAAP adjusted EBITDA margin came in at 24.7%, up 20 bps year over year.
Balance Sheet & Cash Flow
As of Dec 31, 2022, Blackbaud had total cash, cash equivalents and restricted cash of $733.9 million compared with $375.4 million as of Sep 30, 2022.
Total debt (including the current portion) as of Dec 31, 2022, amounted to $859 million compared with $854.1 million as of Sep 30, 2022.
Cash provided by operating activities in the three months ended Dec 31, 2022, was $14.1 million compared with $43.9 million in the prior-year period.
Non-GAAP adjusted free cash flow in the fourth quarter was $7.6 million compared with $31.9 million in the previous-year quarter.
2023 Guidance
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.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
At this time, Blackbaud has an average Growth Score of C, a grade with the same score on the momentum front. 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 upward for the stock, and the magnitude of these revisions indicates a downward shift. It comes with little surprise Blackbaud has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.