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Why ACI Worldwide (ACIW) Is Down Today

NEW YORK (TheStreet) -- ACI Worldwide (ACIW) fell 6.6% to $55.29 Monday after the software producer issued a downside guidance that falls below analyst estimates.

In its new guidance for the full year 2013 ACI Worldwide expects revenue of between $865 million and $870 million. That falls below the Capital IQ Consensus Estimate that calls for revenue of $883.5 million for the year.

The software company now expects non-GAAP operating income of between $150 million and $155 million, below the previous forecast of $165 million to $175 million. ACI Worldwide also lowered its adjusted EBITDA estimates to between $235 million and $240 million from between $257 million to $267million.

Must read: New Lifetime High For ACI Worldwide (ACIW)

TheStreet Ratings team rates ACI WORLDWIDE INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate ACI WORLDWIDE INC (ACIW) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, compelling growth in net income, good cash flow from operations and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 10.9%. Since the same quarter one year prior, revenues rose by 38.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 143.3% when compared to the same quarter one year prior, rising from $5.66 million to $13.76 million.
  • Net operating cash flow has significantly increased by 443.26% to $28.93 million when compared to the same quarter last year. In addition, ACI WORLDWIDE INC has also vastly surpassed the industry average cash flow growth rate of 0.21%.
  • ACI WORLDWIDE INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ACI WORLDWIDE INC reported lower earnings of $1.21 versus $1.35 in the prior year. This year, the market expects an improvement in earnings ($2.03 versus $1.21).
  • You can view the full analysis from the report here: ACIW Ratings Report

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