CoreLogic, Inc.CLGX yesterday announced that it has raised the guidance for the third quarter of 2020. It has also raised the outlook for full-year 2020 and 2021. The company is optimistic about its quarterly and yearly results on the back of solid operating and financial performance.
Notably, Frank Martell, president and chief executive officer at CoreLogic, stated, "CoreLogic continues to drive high performance across our range of solutions, and the pathway to deliver our financial commitments going forward is clear and evident. Our consistent operating and financial performance is powering higher capital returns. We believe this strong performance demonstrates that we are at an inflection point and poised for further expansion of our trading multiple, which we expect will create significant additional value for our shareholders."
The company’s shares have charted a solid trajectory in recent times, appreciating 55.6% so far this year, ahead of 7.9% growth of the industry it belongs to.
Raised Q3 and 2020 Guidance
CoreLogic anticipates upbeat third-quarter and full-year 2020 revenues and adjusted EBITDA on the back of strength in property-tax processing, insurance & spatial, and international and consistent solid housing market fundamentals.
For third-quarter 2020, CoreLogic now expects revenues of $525-$535 million compared with the prior guidance of $485-$515 million, provided along with second-quarter results on Jul 27. The Zacks Consensus Estimate of $496.39 million lies below the current guidance.
Adjusted EBITDA is now anticipated between $187 million and $192 million compared with the prior guidance of $160-$175 million.
Further, the company expects operating leverage and cost productivity to drive adjusted EBITDA margin beyond 35%, increasing by more than 500 basis points year over year.
For 2020, CoreLogic now expects revenues of $1.920-$1.945 billion compared with the prior guidance of $1.86-$1.895 billion. The Zacks Consensus Estimate of $1.88 billion is lower than the current guidance.
Adjusted EBITDA is now anticipated between $615 million and $630 million compared with the prior guidance of $580-$600 million.
The company anticipates double-digit revenue growth during the second half of 2020, with at least upper-single-digit organic growth and margin expansion of at least 300 basis points year over year.
Raised 2021 Guidance
Considering the upbeat 2020 outlook along with contracted and secured business wins, increased recurring revenues, and persistent solid housing-market fundamentals, CoreLogic raised its full-year 2021 guidance.
The company now expects revenues of $1.965-$2.010 billion compared with the prior guidance of $1.91-$1.95 billion. The Zacks Consensus Estimate of $1.87 billion is lower than the current guidance.
Adjusted EBITDA is now anticipated between $635 million and $660 million compared with the prior guidance of $595-$615 million.
Although many companies across diverse sectors have suspended dividend payouts and share buybacks amid the coronavirus crisis, CoreLogic remains one of those few that are sailing through the tough economic times and maintaining dividend payouts and share repurchases.
The company has reaffirmed its plans to repurchase at least $500 million shares in 2020, $300 million in 2021 and $200 million in 2022, to complete its current $1 billion authorization. Previously, concurrent with the second-quarter 2020 results, the company’s board approved a 50% dividend hike, raising the quarterly cash dividend from 22 to 33 cents per share.
Notably, CoreLogic has a track record of consistent share repurchases and dividend payments. Such shareholder friendly moves not only instill investor confidence but also positively impact earnings per share.
Zacks Rank and Other Stocks to Consider
CoreLogic currently sports a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the broader Zacks Business Services sector are Republic Services RSG, FactSet Research FDS and NV5 Global NVEE, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The long-term expected-earnings per share (three to five years) growth rate for Republic Services, FactSet Research and NV5 Global is 7.9%, 8.5% and 13.7%, respectively.
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