In this article, we will take a look at the 10 tech stocks gaining value after earnings.
Earnings reports from the tech sector continued this week, with most stocks beating expectations for their respective quarters. Uber Technologies, Inc. (NYSE:UBER), Microchip Technology Incorporated (NASDAQ:MCHP) and ON Semiconductor Corporation (NASDAQ:ON) were among the notable tech companies that rose after releasing their financial results.
In addition, ZoomInfo Technologies Inc. (NASDAQ:ZI) and Dynatrace, Inc. (NYSE:DT) also gained value following their upbeat quarterly performances. We will discuss the financial highlights and subsequent share-price movement of these companies in the remaining article.
10. Freshworks Inc. (NASDAQ:FRSH)
Number of Hedge Fund Holders: 25
Shares of Freshworks Inc. (NASDAQ:FRSH) rose to a nearly one-month high on Wednesday, August 3, 2022, after reporting solid sales for the second quarter. The provider of customer service software generated sales of $121.4 million in the quarter, representing a surge of 37 percent on a year-over-year basis.
In addition, Freshworks Inc. (NASDAQ:FRSH) reported an adjusted loss of 6 cents per share, narrower than 8 cents per share in the same period of 2021. Analysts were looking for a loss of 6 cents per share on revenue of $118.24 million.
Freshworks Inc. (NASDAQ:FRSH) also issued its financial outlook for the third quarter. It expects an adjusted loss in the range of 7 – 5 cents per share and revenue between $124.5 – $126.5 million for the current quarter.
9. Alteryx, Inc. (NYSE:AYX)
Number of Hedge Fund Holders: 31
Alteryx, Inc. (NYSE:AYX) recently announced better-than-expected financial results for the second quarter along with an upbeat sales outlook. Alteryx stock skyrocketed over 19 percent on Wednesday, August 3, 2022, following the latest performance.
The Irvine-based tech firm reported an adjusted loss of 46 cents per share, narrower than analysts’ average estimate for a loss of 60 cents per share. Revenue for the quarter jumped 50 percent versus last year to $180.6 million, while analysts expected Alteryx, Inc. (NYSE:AYX) to post revenue of $161.02 million.
For the third quarter, Alteryx, Inc. (NYSE:AYX) guided for revenue of $191 – $194 million, representing year-over-year growth of 55 – 57 percent. For the full year, the company projected revenue of $770 – $780 million, representing a surge of 44 – 45 percent over 2021.
Like Alteryx, Inc. (NYSE:AYX), Uber Technologies, Inc. (NYSE:UBER), Microchip Technology Incorporated (NASDAQ:MCHP) and ON Semiconductor Corporation (NASDAQ:ON) also rose after posting their earnings.
8. Gartner, Inc. (NYSE:IT)
Number of Hedge Fund Holders: 35
Shares of Gartner, Inc. (NYSE:IT) climbed to a nearly three-month high on Tuesday, August 2, 2022, after the technological research and consulting firm easily surpassed financial expectations for the second quarter.
Gartner, Inc. (NYSE:IT) reported adjusted earnings of $2.85 per share, up from $2.24 per share in the year-ago period. Revenue increased to $1.377 billion, from $1.167 billion in the comparable period of 2022. The results exceeded the consensus of $2.13 per share for earnings and $1.32 billion for revenue.
Gartner, Inc. (NYSE:IT) also disclosed its segment-wise sales results. Its research revenue rose 13.9 percent to $1.14 billion, conferences revenue skyrocketed 95.1 percent to $114 million and consulting revenue jumped nearly 14 percent to $121 million in the quarter.
Separately, investment management firm Weitz Investment Management mentioned Gartner, Inc. (NYSE:IT) in its first-quarter 2022 investor letter, stating:
“We added a new position in Gartner (NYSE:IT) as tech-adjacent stocks continued their fall from grace during the quarter. Gartner is the leading provider of subscription-based research services to IT and business professionals (think C-suite executives, among others). The company has an attractive “create once, sell many times” business model that should sound familiar to long-time Fund investors. While Gartner does not scream “cheap” on current earnings, we are drawn to the company’s durability, business momentum, and extended glide path of capital-light, double-digit revenue, and cash flow growth potential.”
7. Alight, Inc. (NYSE:ALIT)
Number of Hedge Fund Holders: 38
Shares of Alight, Inc. (NYSE:ALIT) jumped over 10 percent on Wednesday, August 3, 2022, following its second-quarter results. The Illinois-based company reported adjusted earnings of 12 cents per share, in line with the expectations.
In addition, Alight, Inc. (NYSE:ALIT) posted revenue of $715 million, up 6.4 percent on a year-over-year basis and above expectations of $710.29 million. The Employer Solutions segment was the biggest sales driver, generating revenue of $614 million. In comparison, Professional Services revenue came in at $91 million, while Hosted Business revenue stood at $10 million in the quarter.
Alight, Inc. (NYSE:ALIT) also issued its financial outlook for 2022. It expects adjusted earnings in the range of 54 – 60 cents per share and revenue between $3.09 – $3.12 billion for the full year.
Like Alight, Inc. (NYSE:ALIT), shares of Uber Technologies, Inc. (NYSE:UBER), Microchip Technology Incorporated (NASDAQ:MCHP) and ON Semiconductor Corporation (NASDAQ:ON) also rose after their recent earnings.
6. Sabre Corporation (NASDAQ:SABR)
Number of Hedge Fund Holders: 38
Shares of Sabre Corporation (NASDAQ:SABR) rose for two straight days, gaining more than 16 percent, after delivering solid Q2 results on Tuesday, August 2, 2022. The travel technology company primarily benefitted from a surge in air bookings during the quarter.
Sabre Corporation (NASDAQ:SABR) reported an adjusted loss of 25 cents per share, narrower than analysts’ average estimate for a loss of 31 cents per share. Revenue for the quarter climbed 57 percent versus last year to $657.5 million, topping estimates of $649.7 million.
If we look at the performance of its flagship segments, travel solutions revenue jumped 60 percent to $599 million, distribution revenue skyrocketed 98 percent to $432 million and IT solutions revenue increased 8 percent to $168 million in the quarter.
Sabre Corporation (NASDAQ:SABR) also raised its fiscal 2022 sales outlook to a range of $2.3 – $2.6 billion, from its previous guidance between $2.2 – $2.5 billion.
5. Microchip Technology Incorporated (NASDAQ:MCHP)
Number of Hedge Fund Holders: 42
Shares of Microchip Technology Incorporated (NASDAQ:MCHP) rose to a nearly two-month high on Wednesday, August 3, 2022, after surpassing profit and sales expectations for its fiscal first quarter.
Microchip Technology Incorporated (NASDAQ:MCHP) reported adjusted earnings of $1.37 per share, well above 99 cents per share in the year-ago period. Revenue for the quarter jumped 25.1 percent on a year-over-year basis to $1.964 billion. The results were better than the consensus of $1.34 per share for earnings and $1.95 billion for revenue.
Among other updates, Microchip Technology Incorporated (NASDAQ:MCHP) announced that it paid back a debt of $233.6 million in the June quarter. Moreover, the company also repurchased 2.9 million shares of its common stock during the same period.
4. Dynatrace, Inc. (NYSE:DT)
Number of Hedge Fund Holders: 43
Dynatrace, Inc. (NYSE:DT) announced better-than-expected financial results for its fiscal first quarter, sending its shares up more than five percent on Wednesday, August 3, 2022. The provider of the software intelligence platform earned 18 cents per share on an adjusted basis, compared to 16 cents per share in the same period of 2021.
Revenue came in at $267 million, representing a year-over-year gain of 32 percent. Analysts expected Dynatrace, Inc. (NYSE:DT) to post earnings of 17 cents per share on revenue of $262.43 million.
For the current quarter, Dynatrace, Inc. (NYSE:DT) expects adjusted earnings in the range of 18 – 19 cents per share and revenue between $272 – $275 million.
Praising the results, CEO Rick McConnell said:
“Q1 was yet another quarter of solid execution with balanced growth and profitability highlighting the durability of our business in the current environment. We continue to see digital transformation initiatives with clear and measurable ROI as a top priority for the global 15,000 organizations that we target. Automation and AIOps are requirements for companies looking to do more with less time, resource, and cost. Our platform is rooted in these capabilities, which differentiate us from our competitors and position us well for continued growth and success in the future.”
3. ON Semiconductor Corporation (NASDAQ:ON)
Number of Hedge Fund Holders: 48
ON Semiconductor Corporation (NASDAQ:ON) delivered record financial results for the second quarter on Monday, August 1, 2022. The stock initially fell but then jumped to a nearly seven-month high following the results.
The Arizona-based semiconductor supplier reported adjusted earnings of $1.34 per share, representing a jump of more than two folds over the year-ago period. In addition, ON Semiconductor Corporation (NASDAQ:ON) posted revenue of $2.085 billion, up 25 percent on a year-over-year basis. The results easily exceeded the consensus of $1.26 per share for earnings and $2.010 billion for revenue.
Several research firms increased their price targets for ON Semiconductor Corporation (NASDAQ:ON) following its latest quarterly performance. Jefferies lifted its price target for the semiconductor company from $75 per share to $77 per share, while Deutsche Bank raised its price target from $65 per share to $75 per share.
2. ZoomInfo Technologies Inc. (NASDAQ:ZI)
Number of Hedge Fund Holders: 48
Shares of ZoomInfo Technologies Inc. (NASDAQ:ZI) have been trading higher since reporting its second-quarter results on Monday, August 1, 2022. The provider of marketing solutions reported adjusted earnings of 21 cents per share, beating the consensus of 17 cents per share.
Revenue for the quarter soared 54 percent versus last year to $267.1 million, while analysts were expecting ZoomInfo Technologies Inc. (NASDAQ:ZI) to generate revenue of $252.75 million
Besides solid Q2 earnings, ZoomInfo Technologies Inc. (NASDAQ:ZI) also raised its financial outlook for 2022. It expects adjusted earnings of 78 – 80 cents per share on revenue of $1.08 – $1.09 billion for the full year. Earlier, it was looking for adjusted earnings of 75 – 77 cents per share and revenue of $1.06 – $1.07 billion.
Separately, asset management firm Baron Funds also mentioned ZoomInfo Technologies Inc. (NASDAQ:ZI) in its first-quarter 2022 investor letter, stating:
“ZoomInfo Technologies Inc. operates a cloud-based B2B platform that provides sales, marketing, and HR teams with comprehensive business intelligence, enabling shorter sales cycles and higher win rates. While the stock was down 7% over the course of the first quarter, well-timed purchases turned it into a contributor that added 18bps to absolute returns. The company continues to execute well with another positive quarterly earnings surprise and strong forward bookings, with 2021 revenues growing 57% year-over-year, and with 46% free-cash-flow margins. New products are starting to build momentum, and we believe ZoomInfo can become a much larger company over time as it penetrates its $70 billion total addressable market.”
1. Uber Technologies, Inc. (NYSE:UBER)
Number of Hedge Fund Holders: 144
Shares of Uber Technologies, Inc. (NYSE:UBER) climbed nearly 19 percent on Tuesday, August 2, despite announcing mixed results for the second quarter. Perhaps, investors seemed impressed with the company’s Q2 revenue, which skyrocketed 105 percent on a year-over-year basis to $8.1 billion and crushed the consensus of $7.4 billion.
On the downside, Uber Technologies, Inc. (NYSE:UBER) reported a loss of $1.33 per share, much wider than analysts’ average estimate for a loss of 27 cents per share.
Among other updates, Uber Technologies, Inc. (NYSE:UBER) reported that gross booking for the quarter jumped 33 percent to $29.1 billion, with mobility gross bookings rising 55 percent and delivery gross bookings improving 7 percent on a year-over-year basis.
For the current quarter, Uber Technologies, Inc. (NYSE:UBER) projected adjusted EBITDA in the range of $440 – $470 million and gross bookings between $29 – $30 billion.
Speaking on the results, CFO Nelson Chai said:
“We became a free cash flow generator in Q2, as we continued to scale our asset-light platform, and we will continue to build on that momentum. This marks a new phase for Uber, self-funding future growth with disciplined capital allocation, while maximizing long-term returns for shareholders.”
You can also take a peek at 10 Dividend Stocks to Buy According to John Allison’s Unio Capital and Jim Cramer Recommends These 10 Stocks For Recession.
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Disclosure: None. 10 Tech Stocks Gaining Value After Earnings is originally published on Insider Monkey.
