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ePlus (PLUS) Q4 Earnings Beat Estimates, Revenues Up Y/Y
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ePlus (PLUS - Free Report) reported fourth-quarter fiscal 2022 non-GAAP earnings of $1.01 per share, beating the Zacks Consensus Estimate by 48.53%. The figure surged 42.3% year over year.
Revenues of $451.5 million beat the consensus mark by 10.78% and increased 28.1% year over year.
Technology net sales increased 14.9% year over year to $1.73 billion due to the higher sales of products and services. Financing net sales increased 54.4% to $32.1 million, primarily due to higher post-contract revenues from early lease buyouts.
Quarter Details
Product revenues accounted for 86.3% of total revenues. The figure was $394.4 million, up 30.1% year over year.
Services revenues contributed 13.7% to total revenues. The figure was $61.6 million, up 16.6% year over year.
Adjusted gross billings increased 20.8% year over year to $638.5 million. The company witnessed strong growth in collaboration and networking as the hybrid work environment continues to gain traction.
The gross margin contracted 220 basis points (bps) year over year to 25.5%. The year-over-year decline was primarily due to lower margins from ePlus’ financing segment combined with lower service margins.
Adjusted EBITDA increased 34.4% year over year to $39.7 million in the reported quarter. Technology adjusted EBITDA increased 58.4% year over year to $31.5 million.
SG&A expenses, as a percentage of revenues, decreased 270 bps on a year-over-year basis to 17%.
Depreciation & amortization expenses, as a percentage of revenues, were 0.7%, down 40 bps year over year.
Interest and financing costs, as a percentage of revenues, declined 10 bps on a year-over-year basis to 0.1%.
Total operating expenses, as a percentage of revenues, were 17.9%, down 320 bps on a year-over-year basis.
The operating margin expanded 90 bps on a year-over-year basis to 7.6%.
Balance Sheet
As of Apr 30, 2022, ePlus had cash and cash equivalents of $155.4 million.
In the reported quarter, PLUS announced a stock repurchase program, with the authorization to purchase up to one million shares.
Fiscal 2023 Outlook
ePlus expects solid top-line growth in fiscal 2023. However, the extending lead time due to supply-chain constraints is expected to hurt the implementation time of IT projects. This, in turn, is expected to hurt the top line.
Zacks Rank & Stocks to Consider
ePlus currently has a Zacks Rank #3 (Hold).
PLUS shares have risen 3.7% against the Zacks Computer & Technology sector’s decline of 28.5% year to date (YTD).
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ePlus (PLUS) Q4 Earnings Beat Estimates, Revenues Up Y/Y
ePlus (PLUS - Free Report) reported fourth-quarter fiscal 2022 non-GAAP earnings of $1.01 per share, beating the Zacks Consensus Estimate by 48.53%. The figure surged 42.3% year over year.
Revenues of $451.5 million beat the consensus mark by 10.78% and increased 28.1% year over year.
Technology net sales increased 14.9% year over year to $1.73 billion due to the higher sales of products and services. Financing net sales increased 54.4% to $32.1 million, primarily due to higher post-contract revenues from early lease buyouts.
Quarter Details
Product revenues accounted for 86.3% of total revenues. The figure was $394.4 million, up 30.1% year over year.
Services revenues contributed 13.7% to total revenues. The figure was $61.6 million, up 16.6% year over year.
ePlus inc. Price, Consensus and EPS Surprise
ePlus inc. price-consensus-eps-surprise-chart | ePlus inc. Quote
Adjusted gross billings increased 20.8% year over year to $638.5 million. The company witnessed strong growth in collaboration and networking as the hybrid work environment continues to gain traction.
The gross margin contracted 220 basis points (bps) year over year to 25.5%. The year-over-year decline was primarily due to lower margins from ePlus’ financing segment combined with lower service margins.
Adjusted EBITDA increased 34.4% year over year to $39.7 million in the reported quarter. Technology adjusted EBITDA increased 58.4% year over year to $31.5 million.
SG&A expenses, as a percentage of revenues, decreased 270 bps on a year-over-year basis to 17%.
Depreciation & amortization expenses, as a percentage of revenues, were 0.7%, down 40 bps year over year.
Interest and financing costs, as a percentage of revenues, declined 10 bps on a year-over-year basis to 0.1%.
Total operating expenses, as a percentage of revenues, were 17.9%, down 320 bps on a year-over-year basis.
The operating margin expanded 90 bps on a year-over-year basis to 7.6%.
Balance Sheet
As of Apr 30, 2022, ePlus had cash and cash equivalents of $155.4 million.
In the reported quarter, PLUS announced a stock repurchase program, with the authorization to purchase up to one million shares.
Fiscal 2023 Outlook
ePlus expects solid top-line growth in fiscal 2023. However, the extending lead time due to supply-chain constraints is expected to hurt the implementation time of IT projects. This, in turn, is expected to hurt the top line.
Zacks Rank & Stocks to Consider
ePlus currently has a Zacks Rank #3 (Hold).
PLUS shares have risen 3.7% against the Zacks Computer & Technology sector’s decline of 28.5% year to date (YTD).
Some better-ranked stocks to consider from the same sector are Pure Storage (PSTG - Free Report) , Samsara (IOT - Free Report) and The Descartes Systems (DSGX - Free Report) .
While Pure Storage sports a Zacks Rank #1 (Strong Buy), Samsara and Descartes each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Pure Storage’s shares have outperformed the sector YTD, declining 29.3%. PSTG is set to report first-quarter fiscal 2023 results on Jun 1.
Descartes’ shares have underperformed the sector YTD, declining 28.5%. DSGX is set to report first-quarter fiscal 2023 results on Jun 1.
Samsara is scheduled to release first-quarter fiscal 2023 results on Jun 2. IOT shares have been down 61.8% YTD.