Stamps.com Earnings Soar Past Estimates Amid Pandemic

Stamps.com shares surged after its earnings report. The pandemic has kept businesses and consumers reliant on the internet to buy postage.
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Stamps.com  (STMP) - Get Report shares surged Friday after the online postage-service provider reported much stronger earnings for the second quarter than analysts expected.

The coronavirus pandemic has kept businesses and consumers reliant on the internet to buy postage.

Stamps.com shares recently traded at $303.45, up 16%. The stock has more than tripled this year.

Net income registered $51.7 million, or $2.73 a share, in the latest quarter, more than triple the $14 million, or 79 cents a share, of the year-earlier quarter. Analysts surveyed by FactSet had predicted earnings of $1.26 a share for the latest period.

Stamps.com posted revenue of $206.7 million for the latest quarter, up 49% from $138.8 million in the year-earlier quarter. The FactSet analyst consensus called for sales of $153.3 million.

"In recent months, e-commerce has provided an important lifeline to many businesses and individuals in the context of the covid-19 pandemic," Stamps.com Chief Executive Ken McBride said in a statement.

"[We] value our ability to provide a best-in-class, critical shipping technology that enables such e-commerce activity for our customers and partners during this difficult time,” 

Citron Research predicted last month that Shopify  (SHOP) - Get Report would buy Stamps.com. The latter company “is the proven leader in online postage, … the essential tool for small biz not owned by [Shopify]," Citron wrote in a commentary cited by the Motley Fool.

Last year, Stamps.com formed a collaboration with UPS  (UPS) - Get Report to give its customers access to discounted shipping rates. 

Under the agreement, Stamps.com customers gain access to discounts of up to 55% off daily UPS rates, the companies said.