For the first quarter Actuate posted a loss of -1 cent a share, missing the Capital IQ Consensus of earnings of 6 cents a share by 7 cents. Revenue fell 31% from the year-ago quarter to$24.09 million. Analysts expected revenue of $30.1 million for the quarter.
"Actuate experienced a less than ideal first quarter in terms of license revenues," president and CEO Pete Cittadini said in a press release. "The anticipated drop off in legacy iServer license business accounted for large part of the decline from a year ago along with several large transactions slipping out of the first quarter. We did see a second consecutive quarter of subscription bookings over $1 million with bookings coming across all business units, indicating customer preference for the subscription model."
Must read: Warren Buffett's 10 Favorite Growth StocksSELL NOW: If you own any of the 900 stocks that TheStreet Quant Ratings has identified as a 'Sell'...you could potentially lose EVERYTHING in the next 6-12 months. Learn more. TheStreet Ratings team rates ACTUATE CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation: "We rate ACTUATE CORP (BIRT) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and disappointing return on equity." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- 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 62.8% when compared to the same quarter one year prior, rising from $0.76 million to $1.23 million.
- BIRT's debt-to-equity ratio is very low at 0.01 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, BIRT has a quick ratio of 1.81, which demonstrates the ability of the company to cover short-term liquidity needs.
- ACTUATE CORP 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, ACTUATE CORP reported lower earnings of $0.13 versus $0.19 in the prior year. This year, the market expects an improvement in earnings ($0.30 versus $0.13).
- In its most recent trading session, BIRT has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Software industry and the overall market, ACTUATE CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- You can view the full analysis from the report here: BIRT Ratings Report
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