Earnings results often indicate what direction a company will take in the months ahead. With Q3 behind us, let’s have a look at Workiva (NYSE: WK) and its peers.
Organizations are constantly looking to improve organizational efficiencies, whether it is financial planning, tax management or payroll. Finance and HR software benefit from the SaaS-ification of businesses, large and small, who much prefer the flexibility of cloud-based, web-browser delivered software paid for on a subscription basis than the hassle and expense of purchasing and managing on-premise enterprise software.
The 13 finance and HR software stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3% while next quarter’s revenue guidance was in line.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Workiva (NYSE: WK)
Nicknamed "the Excel killer" by some finance professionals for its ability to eliminate spreadsheet chaos, Workiva (NYSE: WK) provides a cloud-based platform that enables organizations to streamline financial reporting, ESG, and compliance processes with connected data and automation.
Workiva reported revenues of $224.2 million, up 20.8% year on year. This print exceeded analysts’ expectations by 2.4%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ billings estimates and EPS guidance for next quarter exceeding analysts’ expectations.
Workiva scored the highest full-year guidance raise of the whole group. The company added 131 enterprise customers paying more than $100,000 annually to reach a total of 2,372. Unsurprisingly, the stock is up 12.2% since reporting and currently trades at $92.16.
Is now the time to buy Workiva? Access our full analysis of the earnings results here, it’s free for active Edge members.
Best Q3: Marqeta (NASDAQ: MQ)
Powering the cards behind innovative fintech services like Block's Cash App, Marqeta (NASDAQ: MQ) provides a cloud-based platform that allows businesses to create customized payment card programs and process card transactions.
Marqeta reported revenues of $163.3 million, up 27.6% year on year, outperforming analysts’ expectations by 9.7%. The business had an incredible quarter with a solid beat of analysts’ EBITDA estimates and a solid beat of analysts’ total payment volume estimates.
The market seems happy with the results as the stock is up 5.2% since reporting. It currently trades at $4.72.
Is now the time to buy Marqeta? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q3: BlackLine (NASDAQ: BL)
Born from the vision to eliminate tedious manual spreadsheet work for accountants, BlackLine (NASDAQ: BL) provides cloud-based software that automates and streamlines financial close, intercompany accounting, and invoice-to-cash processes for accounting departments.
BlackLine reported revenues of $178.3 million, up 7.5% year on year, in line with analysts’ expectations. It was a slower quarter as it posted EPS guidance for next quarter missing analysts’ expectations significantly and decelerating customer growth.
BlackLine delivered the slowest revenue growth in the group. The company lost 27 customers and ended up with a total of 4,424. Interestingly, the stock is up 2.2% since the results and currently trades at $58.08.
Read our full analysis of BlackLine’s results here.
American Express Global Business Travel (NYSE: GBTG)
Originally spun off from American Express in 2014 but maintaining the Amex GBT brand, Global Business Travel Group (NYSE: GBTG) provides end-to-end business travel and expense management solutions, connecting corporate clients with travel suppliers and offering specialized software services.
American Express Global Business Travel reported revenues of $674 million, up 12.9% year on year. This result surpassed analysts’ expectations by 10%. Overall, it was an exceptional quarter as it also put up a solid beat of analysts’ revenue estimates and a decent beat of analysts’ EBITDA estimates.
American Express Global Business Travel delivered the biggest analyst estimates beat among its peers. The stock is down 2.9% since reporting and currently trades at $7.88.
Paychex (NASDAQ: PAYX)
Once known as the go-to service for small business payroll needs, Paychex (NASDAQ: PAYX) provides payroll processing, HR services, employee benefits administration, and insurance solutions to small and medium-sized businesses.
Paychex reported revenues of $1.54 billion, up 16.8% year on year. This print was in line with analysts’ expectations. More broadly, it was a slower quarter as it logged a slight miss of analysts’ EBITDA estimates.
The stock is down 13.1% since reporting and currently trades at $111.75.
Read our full, actionable report on Paychex here, it’s free for active Edge members.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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