Envestnet Drops on Lagging 2021 Outlook
Envestnet (ENV) shares dropped on Friday after the digital financial management company issued 2021 earnings guidance that missed analyst expectations.
The Chicago company expects 2021 adjusted earnings between $1.95 and $2.08 a share on revenue between $1.1 billion and $1.12 billion.
Analysts are expecting earnings of $2.33 a share on revenue of $1.13 billion.
Envestnet shares at last check were down 15% to $68. The stock was off 2.8% in 2021 through Thursday's close. It touched a 52-week high $92.51 in early August.
After the closing bell Thursday, Envestnet reported fourth-quarter adjusted earnings of 69 cents a share as revenue rose 10% to $263.8 million.
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Analysts were expecting earnings of 65 cents per share on revenue of $258.5 million.
"We enter 2021 with an expanded strategic purpose, and a bold investment plan to capture the sizable opportunity before us, as we work to make financial wellness a reality for everyone," Chief Executive Bill Crager said in a statement.
Piper Sandler analyst Christopher Donat slashed his price target to $64 a share from $94. He is concerned that the company's plan for $30 million in investments this year won't come to fruition if the share price continues to slide.
Meanwhile, Raymond James analyst Patrick O'Shaughnessy lowered his price target to $91 from $105 while maintaining his strong buy rating.
"This quarter was a reminder of our love-hate relationship with Envestnet: We love its market leadership within a secular growth opportunity, and we love the optionality the Yodlee business provides, but we hate the occasional earnings call curveball that has emerged over the years,” O'Shaughnessy said.
