NEW YORK (TheStreet) -- Qlik Technology (QLIK - Get Report) was falling 2.9% to $20.40 in after-hours trading Tuesday after Tibco Software (TIBX - Get Report) issued a lower guidance for the second quarter.
Tibco said it now expects revenue of $250 million to $252 million in the fiscal second quarter, down from its previous estimates of $263 million to $271 million. The company expects EPS of 12 cents to 13 cents a share for the quarter, down from estimates of 20 cents to 22 cents a share.
Must read: Warren Buffett's 25 Favorite StocksSTOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. TheStreet Ratings team rates QLIK TECHNOLOGIES INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation: "We rate QLIK TECHNOLOGIES INC (QLIK) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Software industry. The net income has significantly decreased by 96.0% when compared to the same quarter one year ago, falling from -$13.21 million to -$25.88 million.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Software industry and the overall market, QLIK TECHNOLOGIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 26.04%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 93.33% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- QLIK TECHNOLOGIES INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, QLIK TECHNOLOGIES INC swung to a loss, reporting -$0.12 versus $0.04 in the prior year. This year, the market expects an improvement in earnings ($0.25 versus -$0.12).
- The gross profit margin for QLIK TECHNOLOGIES INC is currently very high, coming in at 86.08%. Regardless of QLIK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, QLIK's net profit margin of -23.29% significantly underperformed when compared to the industry average.
- You can view the full analysis from the report here: QLIK Ratings Report