by Ian Harvey
February 28, 2020
Box's shares hit a high of $16.74 after reporting an earnings beat and annual earnings forecast that topped Wall Street estimates after closing on Wednesday.
Using a CALL OPTION “Mentorship Program” Members are already up 54% potential profit, and more is expected as the stock continues to climb.
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The company presented quarterly earnings of $0.07 per share, beating the Consensus Estimate of $0.04 per share. This quarterly report represents an earnings surprise of 75%.
The cloud file-sharing and enterprise collaboration company, posted revenues of $183.59 million for the quarter ended January 2020, surpassing the Consensus Estimate by 1.13%.
The company signed 112 deals worth more than $100,000 in the period that ended Jan. 31. compared with 94 such deals a year earlier,
In the period ended Jan. 31, sales increased 12% to $183.6 million.
"We are firing off on all cylinders on the profitability side and continue to drive a balance between growth and profitability," Chief Executive Officer Aaron Levie
Box’s shares hit a high of $16.74 in extended trading after reporting excellent earnings and rising profitability on Wednesday, after the market closed. Yesterday the stock climbed as high as $16.46 before settling the day, up 2.00%, at $15.28.
The Trade at the Time.....we wrote.....
“Box Inc (NYSE: BOX), the cloud file-sharing and enterprise collaboration company that went public more than three years ago, has seen its share price pushed downwards as the market is large and will grow rapidly with cloud computing adoption, competition is fierce and that has tended to push down prices.
Box Inc shares have taken a beating over the past year. They are down 30%, while the S&P 500 is higher by 20%. In the past month, the drop is even steeper.
Shares are off 10% while the S&P 500 has been flat. Since there has been no rebound momentum, the near-term direction will be determined by the next report of quarterly earnings, which is expected to show a positive improvement in the stock.
BOX is set to report fourth-quarter fiscal 2020 results on Feb 26. In the last reported quarter, the company delivered a positive earnings surprise of 100%.
For the to-be-reported quarter, the Consensus Estimate for earnings has remained stable at 4 cents per share over the past 30 days. This indicates a decline of 33.3% from the year-ago reported figure.
The consensus mark for revenues is $181.5 million, implying growth of 10.9% from the year-ago reported figure.
Box Inc invested in security, compliance and administrative technology during the fiscal fourth quarter. These investments with leading enterprises helped the company capitalize on increasing adoption of cloud computing technologies and the need for secure collaboration. This in turn is likely to have driven top-line growth in the quarter to be reported.
During the quarter, Box rode high on the back of increasing adoption of the cloud content management platform by existing and new customers, including the NHL, Los Angeles World Airports, DC Office of the Attorney General, Epic Games and impossible Foods. Expanding paid customer base is anticipated to have aided its top-line growth in the to-be-reported quarter.
Also, strength across international markets and growing add-on products might have aided the to-be-reported quarter’s earnings.
Box is well poised to increase sales within its existing customer base of Fortune 500 companies, lowering customer acquisition costs.
Its focus on creating an end-to-end content management platform, coupled with reasonable valuation metrics and an expanding clientele, may help Box stock to outperform the S&P 500 in 2020.”
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Box Inc gave an annual earnings forecast that topped Wall Street estimates, suggesting that larger deals and cost cuts are improving profit at the file-sharing company.
Earnings, excluding some expenses, will be 38 cents to 44 cents a share in fiscal 2021, the Redwood City, California-based company said Wednesday in a statement. On average, analysts expected 29 cents a share. Sales in the fiscal first quarter will be as much as $184 million, topping analysts’ projections of $182 million. Shares rose more than 9% in extended trading.
Box’s growth has lagged behind peers and the company has, at times, missed investors’ earnings expectations over the past year. The forecast, and quarterly results, provided some support to Aaron Levie’s promise that new security and collaboration tools, as well as an effort to sell software bundles, will lift the company’s fortunes.
Box’s Shield security tool is “definitely being adopted in a faster-than-expected fashion,” Levie said in an interview. “We’re optimizing all of our expenses across the business and focusing on sales productivity. That has set us up in a good position for Q1 and the rest of the year to drive profitability improvements and growth.”
Box Inc expects to have an operating margin of 9% to 10% this fiscal year, compared with 1% last year.
The company projected revenue of $771 million to $777 million in the
fiscal year, compared with analysts’ estimates of $773 million.
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An Important Note: That any suggestions for options trade considerations require investors/traders to use their own discretion as to when to enter or exit! As well, it is advisable to do further research and due diligence before executing your trade.
It is sometimes best to exit a trade, if there is already sufficient profit accrued, before an earnings report is presented. GREED can be the undoing of a nice profit!