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Factors Setting the Tone for AspenTech (AZPN) in Q1 Earnings
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Aspen Technology, Inc. (AZPN - Free Report) is set to report first-quarter of fiscal 2019 results on Oct 24.
Notably, the company has surpassed the Zacks Consensus Estimate in the trailing four quarters registering an average beat of 11.3%.
In the fourth quarter, earnings came in at 59 cents per share, surpassing the Zacks Consensus Estimate by 3 cents. The figure also exceeded the higher end of management’s guided range of 53-55 cents per share.
Revenues inched up 1.8% from the year-ago quarter to almost $126 million in line with the Zacks Consensus Estimate. However, the figure came ahead of the higher end of management’s projected range of $123-$125 million.
Increase in subscription and software revenues supported year-over-year revenue growth. Solid adoption of Asset Performance Management (“APM”) suite aided growth. The company also witnessed increased demand for Manufacturing & Supply Chain (“MSC”) and engineering suites from owner-operator customers.
In the last reported quarter, AspenTech raked in Subscription and Software revenues of $119.5 million which grew 3.5% on a year-over-year basis. Meanwhile, Services and other revenues declined 21.7% from the year ago quarter to $6.5 million.
What to Expect?
For first-quarter 2019, the analysts polled by Zacks predict earnings of 55 cents per share representing an increase of 3.8% on a year-over-year basis.
The Zacks Consensus Estimate for revenues is pegged at approximately $113.5 million, indicating a decline of around 7.6% from the year-ago quarter.
For first-quarter 2019, the Zacks Consensus Estimate for Subscription and Software revenues is at $100 million, while Services revenues are pegged at $6.8 million.
Factors at Play
AspenTech’s focus on exploring new industry verticals on the back of its APM suite bodes well. Dubbed to be “GEI” (global economy industries), the new industry domains comprise rail, metals and mining, pulp and paper, power, and water.
The company has a strong pipeline for new business bookings, as it continues to innovate& improve operations. Notably, APM accounted for 38% of total pipeline in fourth-quarter 2018 up from 32% in the previous quarter.
Notably, in the last quarter, APM pipeline quadrupled from the year-ago quarter. The company’s more than 70 resellers, OEM partners and systems implementers, contribute to the solid pipeline.
Improvement in engineering and construction (“E&C”) contract renewals is expected to be a positive. Recently, South Korea-based SK Engineering & Construction, an infrastructure builder company, deployed Aspen Capital Cost Estimator (“ACCE”) software to attain asset optimization in the early plant design phase.
AspenTech continues to develop its asset optimization methodologies. In the quarter under review, Malaysia-based oil and gas multinational company, PETRONAS deployed various aspenONE software solutions at its Refinery and Petrochemical Integrated Development (“RAPID”) facility based out of Pengerang, Johor.
The new customer wins remain a positive. However, AspenTech generates significant revenues from energy, chemicals and E&C verticals, characterized with manufacturing complexity and high capital costs.
Reduced capital expenditure in the energy vertical remains a concern despite the company’s attempts to mitigate these risks by exploring new domains.
What the Zacks Model Unveils
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.
AspenTech has a Zacks Rank #3 and an Earnings ESP of 0.00%. This makes surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies, which, as per our model, have the right combination of elements to post an earnings beat this quarter:
Bristol-Myers Squibb Company (BMY - Free Report) has an Earnings ESP of +1.49% and a Zacks Rank #2. The company is slated to report third quarter earnings on Oct 25.
Mellanox Technologies, Ltd. has an Earnings ESP of +1.04% and a Zacks Rank #2. The company is slated to report third quarter earnings on Oct 24.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Factors Setting the Tone for AspenTech (AZPN) in Q1 Earnings
Aspen Technology, Inc. (AZPN - Free Report) is set to report first-quarter of fiscal 2019 results on Oct 24.
Notably, the company has surpassed the Zacks Consensus Estimate in the trailing four quarters registering an average beat of 11.3%.
In the fourth quarter, earnings came in at 59 cents per share, surpassing the Zacks Consensus Estimate by 3 cents. The figure also exceeded the higher end of management’s guided range of 53-55 cents per share.
Revenues inched up 1.8% from the year-ago quarter to almost $126 million in line with the Zacks Consensus Estimate. However, the figure came ahead of the higher end of management’s projected range of $123-$125 million.
Increase in subscription and software revenues supported year-over-year revenue growth. Solid adoption of Asset Performance Management (“APM”) suite aided growth. The company also witnessed increased demand for Manufacturing & Supply Chain (“MSC”) and engineering suites from owner-operator customers.
In the last reported quarter, AspenTech raked in Subscription and Software revenues of $119.5 million which grew 3.5% on a year-over-year basis. Meanwhile, Services and other revenues declined 21.7% from the year ago quarter to $6.5 million.
What to Expect?
For first-quarter 2019, the analysts polled by Zacks predict earnings of 55 cents per share representing an increase of 3.8% on a year-over-year basis.
The Zacks Consensus Estimate for revenues is pegged at approximately $113.5 million, indicating a decline of around 7.6% from the year-ago quarter.
For first-quarter 2019, the Zacks Consensus Estimate for Subscription and Software revenues is at $100 million, while Services revenues are pegged at $6.8 million.
Factors at Play
AspenTech’s focus on exploring new industry verticals on the back of its APM suite bodes well. Dubbed to be “GEI” (global economy industries), the new industry domains comprise rail, metals and mining, pulp and paper, power, and water.
The company has a strong pipeline for new business bookings, as it continues to innovate& improve operations. Notably, APM accounted for 38% of total pipeline in fourth-quarter 2018 up from 32% in the previous quarter.
Notably, in the last quarter, APM pipeline quadrupled from the year-ago quarter. The company’s more than 70 resellers, OEM partners and systems implementers, contribute to the solid pipeline.
Improvement in engineering and construction (“E&C”) contract renewals is expected to be a positive. Recently, South Korea-based SK Engineering & Construction, an infrastructure builder company, deployed Aspen Capital Cost Estimator (“ACCE”) software to attain asset optimization in the early plant design phase.
AspenTech continues to develop its asset optimization methodologies. In the quarter under review, Malaysia-based oil and gas multinational company, PETRONAS deployed various aspenONE software solutions at its Refinery and Petrochemical Integrated Development (“RAPID”) facility based out of Pengerang, Johor.
The new customer wins remain a positive. However, AspenTech generates significant revenues from energy, chemicals and E&C verticals, characterized with manufacturing complexity and high capital costs.
Reduced capital expenditure in the energy vertical remains a concern despite the company’s attempts to mitigate these risks by exploring new domains.
What the Zacks Model Unveils
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.
Aspen Technology, Inc. Price and EPS Surprise
Aspen Technology, Inc. Price and EPS Surprise | Aspen Technology, Inc. Quote
AspenTech has a Zacks Rank #3 and an Earnings ESP of 0.00%. This makes surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies, which, as per our model, have the right combination of elements to post an earnings beat this quarter:
Callaway Golf Company has an Earnings ESP of +71.42% and a Zacks Rank #1. The company is slated to report third quarter earnings on Oct 24. You can see the complete list of today’s Zacks #1 Rank stocks here.
Bristol-Myers Squibb Company (BMY - Free Report) has an Earnings ESP of +1.49% and a Zacks Rank #2. The company is slated to report third quarter earnings on Oct 25.
Mellanox Technologies, Ltd. has an Earnings ESP of +1.04% and a Zacks Rank #2. The company is slated to report third quarter earnings on Oct 24.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>