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NextGen (NXGN) Earnings and Revenues Beat Estimates in Q4

Zacks Equity Research

NextGen Healthcare, Inc. NXGN reported fourth-quarter fiscal 2020 adjusted earnings per share (EPS) of 20 cents, beating the Zacks Consensus Estimate of 19 cents by 5.3%. However, the bottom line declined 13% from the prior-year quarter.

For fiscal 2020, adjusted EPS came in at 83 cents, down 3.5% from the previous period. The metric outpaced the Zacks Consensus Estimate of 81 cents.

Revenue Details

Revenues of this Zacks Rank #3 (Hold) company amounted to $136.4 million, up 1.2% year over year. Moreover, the top line surpassed the Zacks Consensus Estimate by 0.4%.

For fiscal 2020, revenues grossed $540.2 million, up 2.1% from the prior-year period. However, the metric missed the consensus mark by 0.1%.

NEXTGEN HEALTHCARE, INC Price, Consensus and EPS Surprise

NEXTGEN HEALTHCARE, INC Price, Consensus and EPS Surprise

NEXTGEN HEALTHCARE, INC price-consensus-eps-surprise-chart | NEXTGEN HEALTHCARE, INC Quote

Bookings Update

Bookings for the quarter came in at $31 million, down 12.4% from the year-ago quarter.

Segment Details

The company reported fourth-quarter fiscal 2020 revenues under the following segments:

Total Recurring revenues were $124.5 million, up 3.6% from the year-ago quarter.

Meanwhile, total Software, hardware and other non-recurring revenues amounted to $11.9 million, down 18.7% on a year-over-year basis.

Margin

In the quarter under review, gross profit totaled $68 million, down 6.4% from the prior-year quarter. Gross margin was 49.9%, down 400 basis points (bps).

Operating loss in the fiscal fourth quarter was $6.3 million, against the year-ago quarter’s operating income of $6.5 million.

Fiscal 2021 Guidance

NextGen announced in its business update on Apr 28, 2020 that it will not issue any guidance for fiscal 2021 or the years beyond considering the uncertainty surrounding the COVID-19 pandemic. The company will decide on guidance after evaluating the scenario once it stabilizes and there is more confidence in the macro environment.

Summing Up

NextGen exited the fiscal fourth quarter on a strong note. The company benefited from its Recurring segment in the quarter under review. Meanwhile, NextGen’s Software, hardware and other non-recurring revenues were soft in the quarter under review. Bookings also declined in the quarter. Significant contraction in gross margin remains a concern. Additionally, NextGen faces stiff rivalry in the MedTech space.

Key Picks

Some better-ranked stocks in the broader medical space are Aphria Inc. APHA, Biogen Inc. BIIB and Eli Lilly and Company LLY.

Aphria reported third-quarter fiscal 2020 adjusted EPS of 2 cents, beating the Zacks Consensus Estimate of a loss of 4 cents. Net revenues of $64.4 million surpassed the consensus mark by 14.6%. The company carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Biogen currently carries a Zacks Rank #2. It reported first-quarter 2020 adjusted EPS of $9.14, surpassing the Zacks Consensus Estimate by 18.1%. Revenues of $3.53 billion outpaced the consensus mark by 3.2%.

Eli Lilly reported first-quarter 2020 EPS of $1.75, outpacing the Zacks Consensus Estimate by 12.9%. Revenues of $145.3 million surpassed the consensus estimate by 6.3%. The company currently sports a Zacks Rank #1.

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