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Jack Henry (JKHY) Q3 Earnings Beat, Revenues Miss Estimates
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Jack Henry & Associates, Inc. (JKHY - Free Report) reported third-quarter fiscal 2021 earnings of 95 cents per share, which surpassed the Zacks Consensus Estimate by 10.5%. Further, the bottom line increased 1.1% sequentially but decreased 1% year over year.
Revenues improved 1% year over year and 2.7% sequentially to $433.8 million. However, the top line missed the Zacks Consensus Estimate of $436.6 million.
The company’s non-GAAP revenues were $429.41 million, up 6% from the year-ago quarter and 2.2% from the prior quarter.
Year-over-year revenue growth was driven by strength across the Payments and Complementary segments in the reported quarter. Additionally, accelerating processing revenues contributed to the results.
However, sluggishness in the Core and Corporate segments was concerning. Further, declining services and support revenues were overhangs.
Jack Henry & Associates, Inc. Price, Consensus and EPS Surprise
Services & Support: The company generated revenues of $254.64 million from the category (59% of revenues). Notably, the figure declined 6% from the year-ago quarter due to a decrease in hardware and deconversion fee revenues. Nevertheless, the company witnessed growth in data processing and hosting fees in the reported quarter.
Processing: The category yielded revenues of $179.14 million (41% of revenues) in the reported quarter, up 13% year over year. This can be attributed to growth in card processing transaction volumes. Also, increasing digital and remittance revenues contributed well.
Segments in Detail
Core: The company generated revenues of $135.15 million from the segment (31.2% of total revenues), decreasing 4% year over year.
Payments: The segment yielded revenues of $160.8million (37.1% of total revenues), increasing 7% from the year-ago quarter.
Complementary: The segment generated $125.4 million in revenues (28.9% of total revenues), increasing 1% year over year.
Corporate & Other: The company generated revenues of $12.4 million from the segment (2.8% of total revenues), down 11% from the prior-year quarter.
Operating Details
In third-quarter fiscal 2021, total operating expenses were $342.6million, reflecting ayear-over-year increase of 2%. This can primarily be attributed to higher personnel costs and rising expenses related to the company’s card processing platform.
As a percentage of revenues, the figure contracted 430 basis points year over year to 78.9%.
Notably, operating margin was 21% in the reported quarter, which remained flat on a year-over-year basis.
Balance Sheet
As of Mar 31, 2021, cash and cash equivalents totaled $70.1 million, which decreased from $147.8 million as of Dec 31, 2020.
Trade receivables were $207.7 million in the reported quarter, down from $212.9million in the previous quarter.
Further, the current and long-term debt stood at $200.2 million at the end of the fiscal third quarter compared with $266,000 at the end of second-quarter fiscal 2021.
Guidance
For fiscal 2021, the company’s projection for GAAP revenues changed from $1.76-$1.77 billion to $1.752-$1.757 billion. Notably, the Zacks Consensus Estimate for revenues is pegged at $1.75 billion.
Further, the company’s expectation regarding non-GAAP revenues currently stands at $1.735-$1.74 billion. Previously, it expected $1.73-$1.74 billion.
Further, the company raised the earnings per share outlook for fiscal 2021 from $3.85-$3.90 to $3.98-$4.02. The Zacks Consensus Estimate for the same is pegged at $3.89 per share.
Zacks Rank & Stocks to Consider
Jack Henry currently carries a Zacks Rank #3 (Hold).
Long-term earnings growth rate of Microchip, Qorvo, and Synaptics is pegged at 15.47%, 13.99% and 10%, respectively.
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Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
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Jack Henry (JKHY) Q3 Earnings Beat, Revenues Miss Estimates
Jack Henry & Associates, Inc. (JKHY - Free Report) reported third-quarter fiscal 2021 earnings of 95 cents per share, which surpassed the Zacks Consensus Estimate by 10.5%. Further, the bottom line increased 1.1% sequentially but decreased 1% year over year.
Revenues improved 1% year over year and 2.7% sequentially to $433.8 million. However, the top line missed the Zacks Consensus Estimate of $436.6 million.
The company’s non-GAAP revenues were $429.41 million, up 6% from the year-ago quarter and 2.2% from the prior quarter.
Year-over-year revenue growth was driven by strength across the Payments and Complementary segments in the reported quarter. Additionally, accelerating processing revenues contributed to the results.
However, sluggishness in the Core and Corporate segments was concerning. Further, declining services and support revenues were overhangs.
Jack Henry & Associates, Inc. Price, Consensus and EPS Surprise
Jack Henry & Associates, Inc. price-consensus-eps-surprise-chart | Jack Henry & Associates, Inc. Quote
Top Line in Detail
Services & Support: The company generated revenues of $254.64 million from the category (59% of revenues). Notably, the figure declined 6% from the year-ago quarter due to a decrease in hardware and deconversion fee revenues. Nevertheless, the company witnessed growth in data processing and hosting fees in the reported quarter.
Processing: The category yielded revenues of $179.14 million (41% of revenues) in the reported quarter, up 13% year over year. This can be attributed to growth in card processing transaction volumes. Also, increasing digital and remittance revenues contributed well.
Segments in Detail
Core: The company generated revenues of $135.15 million from the segment (31.2% of total revenues), decreasing 4% year over year.
Payments: The segment yielded revenues of $160.8million (37.1% of total revenues), increasing 7% from the year-ago quarter.
Complementary: The segment generated $125.4 million in revenues (28.9% of total revenues), increasing 1% year over year.
Corporate & Other: The company generated revenues of $12.4 million from the segment (2.8% of total revenues), down 11% from the prior-year quarter.
Operating Details
In third-quarter fiscal 2021, total operating expenses were $342.6million, reflecting ayear-over-year increase of 2%. This can primarily be attributed to higher personnel costs and rising expenses related to the company’s card processing platform.
As a percentage of revenues, the figure contracted 430 basis points year over year to 78.9%.
Notably, operating margin was 21% in the reported quarter, which remained flat on a year-over-year basis.
Balance Sheet
As of Mar 31, 2021, cash and cash equivalents totaled $70.1 million, which decreased from $147.8 million as of Dec 31, 2020.
Trade receivables were $207.7 million in the reported quarter, down from $212.9million in the previous quarter.
Further, the current and long-term debt stood at $200.2 million at the end of the fiscal third quarter compared with $266,000 at the end of second-quarter fiscal 2021.
Guidance
For fiscal 2021, the company’s projection for GAAP revenues changed from $1.76-$1.77 billion to $1.752-$1.757 billion. Notably, the Zacks Consensus Estimate for revenues is pegged at $1.75 billion.
Further, the company’s expectation regarding non-GAAP revenues currently stands at $1.735-$1.74 billion. Previously, it expected $1.73-$1.74 billion.
Further, the company raised the earnings per share outlook for fiscal 2021 from $3.85-$3.90 to $3.98-$4.02. The Zacks Consensus Estimate for the same is pegged at $3.89 per share.
Zacks Rank & Stocks to Consider
Jack Henry currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector are Qorvo (QRVO - Free Report) , Microchip (MCHP - Free Report) and Synaptics Incorporated (SYNA - Free Report) . All the stocks carry a Zacks Rank #2, at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth rate of Microchip, Qorvo, and Synaptics is pegged at 15.47%, 13.99% and 10%, respectively.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>