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Coupa Software (COUP) Gears Up For Q4 Earnings: What To Expect?

By Zacks Investment ResearchStock MarketsMar 11, 2020 09:57PM ET
www.investing.com/analysis/coupa-software-coup-gears-up-for-q4-earnings-what-to-expect-200515403
Coupa Software (COUP) Gears Up For Q4 Earnings: What To Expect?
By Zacks Investment Research   |  Mar 11, 2020 09:57PM ET
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Coupa Software (NASDAQ:COUP) is scheduled to report fourth-quarter fiscal 2020 results on Mar 16.

For the fiscal fourth quarter, the company expects earnings in the range of 3-6 cents per share. The Zacks Consensus Estimate for earnings has been steady over the past 30 days at 5 cents per share, in line with the year-ago quarter’s reported figure.

Revenues are anticipated in the range of $101.5-$102.5 million. The consensus mark for fiscal fourth-quarter revenues is pegged at $102.77 million, suggesting growth of 37.2% from the prior-year quarter figure.

One Year Price Performance



Notably, the stock has returned 34.4% in the past year, against the industry’s decline of 10.9%.

Factors Likely to Have Influenced Q4 Results

Coupa Software’s fiscal third-quarter performance is likely to have benefited from robust adoption of Business Spend Management (BSM) offerings and an expanding customer base.

Efficient and smart spend-control programs that provide enhanced reporting and analytics have been the primary catalyst for Coupa Software’s expanding clientele. Such factors are likely to have contributed to the company’s subscription services revenues in the quarter to be reported.

Coupa Software anticipates Subscription revenues between $91.5 million and $92.5 million. The Zacks Consensus Estimate for Subscription revenues is currently pegged at $93 million, suggesting growth of 37.7% from the prior-year reported figure.

Notably, the company anticipates professional services revenues to be approximately $10 million. The Zacks Consensus Estimate for Professional services and other revenues is currently pegged at $10.44 million, suggesting growth of 41.5% from the prior-year quarter.

Moreover, ongoing momentum in solutions such as Accelerate, Invoice payments and Virtual Cards for Pos is likely to have driven the fiscal fourth-quarter top line. It has extended these solutions to partners like American Express (NYSE:AXP), Citibank, Transfermate, Stripe and PayPal.

Further, the company has been adding new capabilities to Coupa Supplier Insights and Coupa Source Together solutions, which is anticipated to have bolstered adoption and generated incremental revenues in the quarter under review. Notably, the company strengthened Coupa Pay solution with support for Expense Payments.

Introduction of Coupa CLM Advanced on synergies from integration of Coupa BSM platform with Exari's technology amid ongoing digital transformation is expected to have strengthened the company’s position in the BSM market.

However, rising operating expenses are likely to have weighed on the company’s fiscal fourth-quarter margins.

Key Development in Q4

During the fiscal fourth quarter, Coupa Software acquired Seattle-based Yapta, with an aim to strengthen Coupa BSM Platform’s Travel and Expense offering with travel price optimization capabilities and offer travel savings to businesses in real-time.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Coupa Software this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Although Coupa Software currently has a Zacks Rank #1, an Earnings ESP of 0.00% makes surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few stocks that you may consider, as our proven model shows that these have the right combination of elements to post an earnings beat.

Micron Technology, Inc. (NASDAQ:MU) has an Earnings ESP of +5.05% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Tencent Holdings Limited (OTC:TCEHY) has an Earnings ESP of +6.03% and a Zacks Rank #2.

Lululemon Athletica Inc. (NASDAQ:LULU) has an Earnings ESP of +0.27% and a Zacks Rank #2.

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COUPA SOFTWARE (COUP): Free Stock Analysis Report

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Coupa Software (COUP) Gears Up For Q4 Earnings: What To Expect?
 

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Coupa Software (COUP) Gears Up For Q4 Earnings: What To Expect?

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