Coupa Posts Surprise 4Q Profit As Sales Pop 47%

Coupa Software swung to a surprise profit in the fiscal fourth quarter (ended Jan. 31), topping analysts’ expectations, driven by a 47% year-over-year rise in revenues. Shares of the global technology platform rose 2% in Tuesday’s extended trading session after closing 3.5% lower on the day.

Coupa (COUP) reported 4Q adjusted earnings of $0.17 per share, down 19% year-over-year. That said, analysts had expected the company to report a loss of $0.11 per share. Revenue of $163.5 million came in ahead of the Street’s estimates of $145.66 million.

The company’s subscription revenue surged 37% year-over-year in the quarter, while calculated billings came in at $270 million, up 49%. (See Coupa stock analysis on TipRanks)

Coupa CEO Rob Bernshteyn said, “We believe that we are now more optimally positioned than ever to deliver broad based global customer success.”

For the fiscal year 2022, the company projects the adjusted loss per share to be in the range of $0.23 to $0.27, versus analysts’ expectations of earnings of $0.36 per share. Revenue is expected to land between $675 million and $678 million, versus the consensus estimate of $664 million.

For fiscal 1Q, the company projects revenue to be in the range of $151.5 million to $152.5 million, versus the consensus estimate of $148.8 million. Adjusted loss per share is forecasted to be in the range of $0.18 to $0.21, versus the loss of $0.01 per share estimated by analysts.

Following the 4Q results, Oppenheimer analyst Brian Schwartz decreased the stock’s price target to $320 (17.7% upside potential) from $380 and maintained a Buy rating “owing to SaaS group multiples’ compression.”

Schwartz believes “software investors will be rewarded over the years as Coupa helps leading organizations modernize, re-envision, and optimize their spend management processes with better functionality, greater data transparency, and visibility, leading to better business decisions and real cost savings realized.”

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating. That’s based on 5 Buys versus 2 Holds. The average analyst price target of $370.71 implies 36.3% upside potential to current levels. Shares have increased 11% over the past six months.

Coupa scores a “Perfect 10” from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

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