Q2 Holdings (QTWO) Q4 Earnings Report Preview: What To Look For

StockStory
02-11
Q2 Holdings (QTWO) Q4 Earnings Report Preview: What To Look For

Banking software provider Q2 (NYSE:QTWO) will be reporting results tomorrow afternoon. Here’s what to expect.

Q2 Holdings beat analysts’ revenue expectations by 0.9% last quarter, reporting revenues of $175 million, up 12.9% year on year. It was a very strong quarter for the company, with an impressive beat of analysts’ billings estimates and a solid beat of analysts’ EBITDA estimates.

Is Q2 Holdings a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Q2 Holdings’s revenue to grow 11% year on year to $179.9 million, in line with the 10.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.47 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Q2 Holdings has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 0.4% on average.

Looking at Q2 Holdings’s peers in the vertical software segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Doximity delivered year-on-year revenue growth of 24.6%, beating analysts’ expectations by 9.6%, and PTC reported revenues up 2.7%, topping estimates by 1.9%. Doximity traded up 35.5% following the results while PTC was down 9.6%.

Read our full analysis of Doximity’s results here and PTC’s results here.

There has been positive sentiment among investors in the vertical software segment, with share prices up 11.4% on average over the last month. Q2 Holdings is up 2.8% during the same time and is heading into earnings with an average analyst price target of $102.71 (compared to the current share price of $93.21).

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