As mentioned last week, today’s Weekly Update will be an abbreviated version owing to the short work week and because of family commitments as our kids are out of school and I am solo parenting, making free writing time hard to come by. That said, to help you keep track of the latest guidance on all positions I’ve maintained our normal formatting and included short notes on all positions.
Let’s get to it.
Recent Changes
Q2 Holdings (QTWO) moves from BUY to HOLD
Updates
Accolade (ACCD). Management presented at the BTIG conference on Wednesday and will again at the SVB Leerink conference next Wednesday. HOLD
Arena Pharmaceuticals (ARNA) announced earnings will be released on February 23. BUY
Confirmed Earnings Date: February 18
Avalara (AVLR) moved to hold last week via Special Bulletin after reporting. Still watching closely. HOLD
Earnings: Done
BioLife Solutions (BLFS) is moving sideways in its established trading range. BUY
Cardlytics (CDLX) hit an all-time high this week and will report earnings on March 1. HOLD
Confirmed Earnings Date: March 1
Cerence (CRNC) reported last Monday and remains at buy. BUY
Earnings: Done
Everbridge (EVBG) reports this afternoon. I’ll detail the results in a Special Bulletin tomorrow morning. Analysts are looking for revenue growth of 27% to $72.5 million and adjusted EPS of $0.02. Current 2021 estimates point toward 26% revenue growth (to $340 million) and adjusted EPS of $0.07. Keeping at buy. BUY
Confirmed Earnings Date: February 18
Fiverr (FVRR) reported early this morning and hosts a conference call at 8:30 am ET. The headline results from Q4 are that revenue grew 89.3% to $55.9 million (beating by $1.8 million) while adjusted EPS of $0.12 beat by $0.02. Fiscal 2021 guidance of $277 million to $284 million is well ahead of $260 million consensus). Management said traffic and buyer registrations reached record levels in January and could accelerate in Q1 2021, when it sees revenue growth near 90%. Fiverr spent a good chunk of change (estimated $8 million) on Super Bowl commercials which will dent earnings in Q1 but could pay dividends in the first half of the year. With the stock having roughly doubled since the last quarterly report it is clear investors have been expecting a lot of growth. Fiverr delivered and seems to be on track for a big 2021 as well. Still, we’ll keep at hold and see how the market digests the results. HOLD HALF
Earnings: Done
Goosehead Insurance (GSHD) hit an all-time high Tuesday. No word yet on an earnings date. HOLD
Inspire Medical Systems (INSP) reports Q4 results next Tuesday and will present at the SVB Leering conference next Wednesday. Analysts are looking for 55% revenue growth to $41.7 million and adjusted EPS of -$0.46. HOLD
Confirmed Earnings Date: February 23
Personalis (PSNL) pre-announced Q4 results several weeks ago then tapped the market with a secondary offering priced at 38. This week management announced a partnership with Natera (NTRA) in personalized oncology. The duo will use Personalis’s NeXT tumor profiling and diagnostic products with Natera’s personalized ctDNA platform Signatera for treatment monitoring and molecular residual disease (MRD) assessment. BUY
Confirmed Earnings Date: February 25
Profound Medical (PROF) was add two weeks ago. The company has developed incision-free therapeutic systems for the ablation of diseased tissue by combining real-time Magnetic Resonance Imaging (MRI), thermal ultrasound and closed-loop temperature feedback control. BUY
Confirmed Earnings Date: March 2
Q2 Holdings (QTWO) reported Q4 results yesterday and hosted a conference call at 8:30 am ET today. The quarter exceeded expectations. Revenue of $109.7 million was up 26% and beat by $2.8 million while adjusted EPS of $0.02 missed by $0.03. Fiscal 2021 revenue guidance for $488 million to $491 million (up 20% to 21%) is in line with expectations. The company ended the quarter with 17.8 million registered users, up 22% from last year and up 4% from the previous quarter. There was a rare contract impairment charge related to a fintech customer that was an early customer of Q2 and which got into some trouble and needed to adjust their contract. Management indicated that this is a very rare occurrence and, as the company has matured, it’s been working with much more stable fintech customers. There was also an accounting adjustment related to the Cloud Lending business as that business is growing and Q2 determined they could better match recognition of costs and revenue. Big picture, it sounds like the all-important Tier 1 business, which was put on pause during Covid-19, is starting to come back and should gather momentum in 2021. A loan pricing contract was announced with a U.S. enterprise bank, Q2 landed a commercial banking contract with a current $8 billion customer as well as a loan pricing contract with an existing $6 billion customer. I like the stock and we’ve had at buy for a while. We’ll move to hold today and let the market digest the quarter. HOLD
Earnings: Done
Porch Group (PRCH) is trading roughly 12% off its all-time high. The stock was moved to hold last week. No recent news. HOLD
Repligen (RGEN) hit an all-time high this week but has pulled back a little since. Management reports Q4 results next Wednesday. Analysts are looking for revenue to grow 35% to $94 million and for EPS to jump 55% to $0.31. BUY
Confirmed Earnings Date: February 17
Sprout Social (SPT) has been on a tear (until yesterday) and reports next Tuesday. We’re looking for revenue to grow 27% to $36 million and for adjusted EPS of -$0.11. HOLD
Confirmed Earnings Date: February 23
Please email me at tyler@cabotwealth.com with any questions or comments about any of our stocks, or anything else on your mind.
