Shares of Bottomline Technologies (EPAY) are higher in morning trading after the company reported better than expected earnings, revenue and EBITDA. Following the report, an analyst at Needham raised his price target, noting the company’s “competitive strengths.” QUARTERLY RESULTS: After the closing bell on Thursday, Bottomline Technologies reported second quarter core earnings per share of 31c, beating analysts’ consensus estimates of 26c and the 26c it reported in the year-ago quarter. Revenue $95.2M also beat estimates of $92.5M and is a 10% increase from last year. Subscription and transaction revenues, which are primarily related to the company’s cloud platforms, were $63.2M, up 14% year-over-year. In a statement, President and Chief Executive Officer Ron Eberle noted that growth and profitability were “ahead of our expectations.” GUIDANCE: Bottomline Technologies provided guidance for the third quarter on its earnings conference call, forecasting EPS of 25c and total revenue of $97M. Analysts currently expect the company to report EPS of 24c on revenue of $92.37M. Subscription and transaction revenue is expected to be $65.5M. Looking to fiscal 2018, Bottomline sees EPS of $1.13-$1.15 and total revenue of $384M-$385M, compared to the current consensus of $1.09 and $374.87M, respectively. Bottomline sees FY18 subscription and transaction revenue of $257M-$258M and adjusted EBITDA of $86M-$87M. The company reiterated its confidence in achieving its targets for fiscal 2019, including $300M in subscription and transaction revenue and $100M in adjusted EBITDA. ANALYST REACTION: In a note to clients following Bottomline’s earnings beat, Needham analyst Mayank Tandon raised his price target to $45 from $38. Tandon said Bottomline’s competitive strengths position it well to executive on revenue growth and margin expansion in the medium- to long-term. He sees the potential for FY18 estimates to move higher based on “robust” booking trends. Craig-Hallum analyst George Sutton said the continued improvement in results and an accelerated backlog suggests management has “all but accomplished” the FY19 goals. Sutton raised his price target to $43 from $40 and reiterated a Buy rating. PRICE ACTION: In early trading, shares of Bottomline Technologies are up 3.5% to $37.95.
next post