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What's in Store for SS&C Technologies (SSNC) Q4 Earnings?

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SS&C Technologies Holdings, Inc. (SSNC - Free Report) is set to report fourth-quarter 2019 results on Feb 12.

The company expects fourth-quarter adjusted revenues between $1.15 billion and $1.18 billion. The Zacks Consensus Estimate for revenues is pegged at $1.17 billion, indicating growth of 3.1% from the year-ago reported figure.

Further, the consensus mark for fourth quarter earnings per share is pegged at 97 cents per share, which suggests an improvement of 2.1% from the year-ago quarter.

Notably, the company surpassed the Zacks Consensus Estimate for earnings in three of the trailing four quarters, with an average positive earnings surprise of 4.92%.

SS&C Technologies Holdings, Inc. Price and EPS Surprise

 

SS&C Technologies Holdings, Inc. Price and EPS Surprise

SS&C Technologies Holdings, Inc. price-eps-surprise | SS&C Technologies Holdings, Inc. Quote

 

Factors at Play

SS&C’s portfolio strength and benefits from strategic acquisitions are expected to have driven the fourth-quarter performance.

Notably, the company completed the buyout of Algorithmics during the fourth quarter, aiding it to expand risk analytics and regulatory offerings. Additionally, the buyout is likely to have strengthened company’s micro-services. All these are expected to have bolstered SS&C’s clientele in the fourth quarter.

Additionally, positive contributions from Intralinks buyout are expected to have benefited SS&C in the to-be-reported quarter. Further, Advent acquisition is likely to have aided the company’s momentum across new funds in Asia during the fourth quarter.

Also, DST acquisition is expected to have strengthened the company’s presence in the U.K. and Australia in the quarter under review.

Apart from buyout benefits, the company is likely to have gained traction in the healthcare industry on the back of its newly launched Cardio Wellness Network, which offers wellness services with embedded pharmacies.

Further, the company is likely to have gained from ongoing trends in the financial services market in the fourth quarter.

The company is expected to have benefited from momentum across fund administrators in the fourth quarter on the back of robust fund services business called SS&C GlobeOp. Additionally, ongoing outsourcing amongst private equity firms is expected to have benefited SS&C’s private equity businesses in the quarter under review.

Moreover, the company acquired clients like – Tiedemann Investment Group (TIG Advisors), Mandiri Investasi and the hedge fund manager, Paloma Partners, during the fourth quarter.

Notably, TIG Advisors and TIG Advisors are leveraging SS&C Geneva, SS&C HiPortfolio, respectively. Paloma Partners has been leveraging SS&C's fund accounting, investor services, middle- and back-office, tax and regulatory services, performance reporting and analytics and e-Investor.

All these are expected to have contributed to the fourth-quarter performance.

However, ballooning debt levels are expected to have affected SS&C in the to-be-reported quarter. Moreover, foreign exchange headwinds are likely to have hurt the company in refinancing debts in the quarter under review.

What Our Model Says

Our proven model doesn’t conclusively predict an earnings beat for SS&C Technologies this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

SS&C Technologies has an Earnings ESP of -0.89% and a Zacks Rank #2.

Stocks to Consider

Here are a few stocks that you may consider, as our proven model shows that these have the right combination of elements to post an earnings beat this quarter.

Alteryx, Inc. (AYX - Free Report) has an Earnings ESP of +6.49% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Applied Materials, Inc. (AMAT - Free Report) has an Earnings ESP of +2.89% and a Zacks Rank of 1.

Five9, Inc. (FIVN - Free Report) has an Earnings ESP of +1.02% and a Zacks Rank of 2.

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