Wall Street's second-quarter earnings season has nearly ended, but results in the coming weeks are due to a variety of cloud-computing Software-as-a-Service (SaaS) companies.
The sector sold off sharply earlier this year on valuation concerns before regaining a foothold with the First Trust Cloud Computing ETF (NASDAQ:) soaring to its all-time high earlier this month.
Below, we highlight three SaaS leaders worth considering ahead of their upcoming quarterly reports.
1. CrowdStrike Holdings
Arrival date: Tuesday 31 August
EPS growth estimate: +166.6% Y-o-Y
Estimated revenue growth: +62.4% Y-o-Y
Performance to date: +9.9%
Market capitalization: $52.5 billion
Crowdstrike Holdings (NASDAQ:) — which has surpassed Wall Street's sales estimates every quarter since its IPO in June 2019 — will report its latest financial results after the U.S. market closes on Tuesday, August 31.
Consensus expectations call for the cloud-based cybersecurity specialist, whose technology is used to detect and prevent security breaches, to hit second-quarter earnings per share (EPS) of $0.08, an improvement of roughly 167% versus earnings per share of $0.03 in the second quarter. years ago.
Meanwhile, revenue is forecast at about 62% year-over-year to an all-time high of $323.3 million, as a result of continued strong demand for its Falcon cybersecurity platform.
In absolute numbers, investors will be watching the growth in CrowdStrike's total subscription customer base. The endpoint security leader — which counts nearly half of Fortune 100 companies as customers — said it had a total of 11,420 customers at the end of the last quarter, an 82% year-over-year increase.
Market players will also pay close attention to the cyber company's outlook for the remainder of the year, as it appears to be one of the main beneficiaries of the continued rise in cybersecurity spending amid rampant cyber-attacks.
Shares of the Sunnyvale, California-based company, which rose 324% in 2020 thanks to a growing wave of corporate cybersecurity spending amid the COVID pandemic, have risen slowly this year, rising just 9.9% in 2021 increased.
CRWD shares ended Tuesday's session at $232.64, giving the company a valuation of $52.5 billion. At current levels, the stock remains about 14.5% below its all-time high of $272.63 reached on July 23.
2. Okta
Income date: Wednesday 1 September
EPS growth estimate: -600% yoy
Estimated revenue growth: +48% Y-o-Y
Performance to date: -9.3%
Market Capitalization: $35.3 billion
Okta (NASDAQ:), which exceeded earnings and earnings expectations for its company in late May but provided weak guidance and announced the departure of its chief financial officer, is expected to report the following financial results after the closing bell on Wednesday, Sept 1
Consensus calls for a loss per share of $0.35 for the second quarter, compared to earnings of $0.07 per share for the same period a year ago, primarily due to the recent acquisition of $6 Auth0 .5 billion, which provides an identity management. platform for application builders.
Revenues are expected to grow 48% year-over-year to an all-time high of $296.7 million, driven by strong demand from large enterprises for their cloud-based identity and access management software.
As such, investors will focus on Okta's subscription software revenue, which grew 38% to $240 million in the last quarter, amid the shift to remote work amid the ongoing health crisis.
In addition to earnings per share and sales, market participants will closely examine the company's update on its outlook for the coming months. The identity and access management specialist forecast a loss in the last quarter in a range of $1.13 to $1.16 per share for fiscal 2022. It forecast annual revenue of $1.22 billion in the middle of the guideline, representing an annual growth of 46%.
OKTA stock closed last night at $230.56, about 22% below the all-time high of $294.00 reached in mid-February. At its current level, the San Francisco, California-based cybersecurity firm has a market cap of $35.3 billion.
After shares surged 120% in 2020 thanks to robust demand for its cybersecurity platform, Okta shares have fallen nearly 9% since the start of the year as investor sentiment cooled on high-growth technology stocks emerging during the COVID-19 showed a rise pandemic.
3. DocuSign
Income date: Thursday 2 September
EPS growth estimate: +135.3% YoY
Estimated revenue growth: +42.8% Y-o-Y
Performance to date: +28.5%
Market Capitalization: $55.6 billion
DocuSign (NASDAQ:) — which shattered earnings and sales records amid rising demand for its e-signature platform — is expected to report financial results for its second fiscal quarter after close on Thursday, Sept. 2.
Consensus estimates call for the software-as-a-service company to post earnings per share of $0.40, a 135% improvement from earnings per share of $0.17 in the same period a year ago .
Revenues are expected to grow approximately 43% year-over-year to a record $488.7 million, driven by strong demand for the Agreement Cloud e-signature platform during the shift to remote working.
In addition to the top and bottom-line numbers, market players will also focus on DocuSign's update on enterprise customer additions to see if it can sustain its scorching growth rate. The company announced in its first quarter earnings report that customers with an annual contract value of more than $300,000 grew approximately 30% from the same period a year ago to 673.
Investors will also focus on comments from DocuSign's management regarding the outlook for the current quarter and beyond, as the existing work environment has created a perfect backdrop for the e-signature giant to thrive.
DOCU shares, which hit a record high of $314.49 on Aug. 10, ended at $285.58 yesterday, giving the San Francisco, California-based tech company a valuation of $55.6 billion.
DocuSign stocks were a big winner during the pandemic, rising 200% in 2020 as the shift to the work-from-home environment led more companies to sign contracts electronically over the internet. Year-to-date, DOCU has gained another 28.5%, easily outperforming the broader market.
