Why Is Nextgen Healthcare (NXGN) Up 5.6% Since Last Earnings Report?
It has been about a month since the last earnings report for Nextgen Healthcare (NXGN). Shares have added about 5.6% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Nextgen Healthcare due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
NextGen Earnings and Revenues Beat Estimates in Q1
NextGen Healthcare, Inc. reported first-quarter fiscal 2021 adjusted earnings per share of 21 cents, beating the Zacks Consensus Estimate of 9 cents. Moreover, the bottom line rose 31.3% from the prior-year quarter.
Revenues of this Zacks Rank #3 (Hold) company amounted to $130.9 million, down 0.8% year over year. However, the top line surpassed theZacks Consensus Estimate by 13.7%.
The company reported first-quarter fiscal 2021 revenues under the following segments:
Total Recurring revenues were $119.5 million, up 0.1% from the year-ago quarter.
Meanwhile, total Software, hardware and other non-recurring revenues amounted to $11.4 million, down 8.1% on a year-over-year basis.
In the quarter under review, gross profit totaled $64.5 million, down 3.2% from the prior-year quarter. Gross margin was 49.3%, down 124 basis points (bps).
Adjusted operating profit came in at $5.6 million, up 24.7% year over year.
Adjusted operating margin in the fiscal first quarter was 4.2%, expanding 87 bps.
Fiscal 2021 Guidance
The company is not issuing any guidance for fiscal 2021 considering the uncertainty surrounding the COVID-19 pandemic. It will decide on the guidance after evaluating the scenario once it stabilizes and there is more confidence in the macro environment..
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 51.58% due to these changes.
At this time, Nextgen Healthcare has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Nextgen Healthcare has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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