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Envestnet (ENV) Stock Declines 1.6% Since Q2 Earnings Beat

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Zacks Equity Research
·4 min read
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Envestnet, Inc.’s ENV second-quarter 2020 earnings and revenues surpassed the Zacks Consensus Estimate.

However, the better-than-expected results failed to impress the market, which is evident from the price decline of 1.6% since the company reported its second-quarter 2020 results on Aug 6.

 

Adjusted earnings per share of 59 cents beat the Zacks Consensus Estimate by 25.5% and increased 28.3% year over year. Revenues of $235.3 million surpassed the consensus mark by 3.5% and climbed 4.8% year over year.

Quarterly Numbers in Detail

Adjusted revenues of $235.4 million jumped 3% year over year. Adjusted net revenues grew 4% to $173.5 million.

Asset-based recurring revenues of $122.2 million increased 2% year over year, representing 52% of total revenues. Subscription-based recurring revenues of $104.9 million were up 14% from the prior-year period, representing 45% of total revenues. Professional services and other non-recurring revenues decreased 33% year over year to $8.1 million.

Adjusted EBITDA came in at $55.8 million, up 29% year over year.

Envestnet ended the second quarter with cash and cash equivalent balance of $92.2 million compared with $68.6 million at the end of the prior quarter. The company generated around $56 million of cash from operating activities. CapEx was $2.2 million.

Envestnet, Inc Price, Consensus and EPS Surprise

 

Envestnet, Inc Price, Consensus and EPS Surprise
Envestnet, Inc Price, Consensus and EPS Surprise

Envestnet, Inc price-consensus-eps-surprise-chart | Envestnet, Inc Quote

Outlook

For third-quarter 2020, Envestnet expects adjusted earningsto be 59 cents per share.The Zacks Consensus Estimate is pegged at57 cents currently. Total revenues are estimated between $244.5 million and $246 million. The current Zacks Consensus Estimate of $246.36 million is higher than the guided range.

Adjusted revenues are anticipated between $244.5 million and $246 million. Adjusted net revenues are projected in the range of$174.5-$176.5 million. The company expects adjusted EBITDA in the band of $56 million to $57 million.

For 2020, adjusted EPS is now expected in the range of $2.28-$2.31 compared with the prior-guided range of $1.92 and $2.02.The Zacks Consensus Estimate of $2.29 million lies within the updated guidance.

Total revenues are now anticipated between $976.3 million and $979.3 million compared with the prior-guided range of $939.5-$945.5 million.The Zacks Consensus Estimate of $982.93 million lies above the updated guidance.

The company now expects adjusted revenues of $977-$980 million compared with the prior guidance of $940-$946 million. Adjusted net revenues are now projected to be in the range$704.5-$708.5 million compared with the prior guidance of $678-$689 million. The company now projects adjusted EBITDA of$221-$223 million compared with the prior guidance of $200-$203 million.

Currently, Envestnet carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Performance of Other Business Services Companies

Equifax EFX reported better-than-expected second-quarter 2020 adjusted earnings of $1.60 per share, whichbeat the Zacks Consensus Estimate by 22.1% and improved 14.3% on a year-over-year basis. The reported figure exceeded the guided range of 78-88 cents.

IQVIA Holdings IQV reported second-quarter 2020 adjusted earnings per share of $1.18, which beat the consensus mark by 12.4% but decreased 22.9% on a year-over-year basis. The reported figure exceeded the guided range of $1.00-$1.09.

Robert Half RHI reported second-quarter 2020 earnings of 41 cents per share that beat the consensus mark by 17% but were down 58% year over year.  

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