Latest news with #Q2Holdings
Yahoo
28-05-2025
- Business
- Yahoo
3 Reasons QTWO is Risky and 1 Stock to Buy Instead
Although the S&P 500 is down 1.9% over the past six months, Q2 Holdings's stock price has fallen further to $88.59, losing shareholders 15.4% of their capital. This may have investors wondering how to approach the situation. Is there a buying opportunity in Q2 Holdings, or does it present a risk to your portfolio? Check out our in-depth research report to see what our analysts have to say, it's free. Even though the stock has become cheaper, we're swiping left on Q2 Holdings for now. Here are three reasons why there are better opportunities than QTWO and a stock we'd rather own. A company's long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last three years, Q2 Holdings grew its sales at a 11.7% compounded annual growth rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the software sector, which enjoys a number of secular tailwinds. For software companies like Q2 Holdings, gross profit tells us how much money remains after paying for the base cost of products and services (typically servers, licenses, and certain personnel). These costs are usually low as a percentage of revenue, explaining why software is more lucrative than other sectors. Q2 Holdings's gross margin is substantially worse than most software businesses, signaling it has relatively high infrastructure costs compared to asset-lite businesses like ServiceNow. As you can see below, it averaged a 51.8% gross margin over the last year. Said differently, Q2 Holdings had to pay a chunky $48.21 to its service providers for every $100 in revenue. Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king. Over the next year, analysts predict Q2 Holdings's cash conversion will fall. Their consensus estimates imply its free cash flow margin of 19.2% for the last 12 months will decrease to 17.1%. Q2 Holdings isn't a terrible business, but it isn't one of our picks. Following the recent decline, the stock trades at 7.2× forward price-to-sales (or $88.59 per share). This multiple tells us a lot of good news is priced in - we think there are better stocks to buy right now. We'd recommend looking at a safe-and-steady industrials business benefiting from an upgrade cycle. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
27-05-2025
- Business
- Yahoo
nCino (NCNO) Q1 Earnings: What To Expect
Bank software company nCino (NASDAQ:NCNO) will be reporting results tomorrow afternoon. Here's what to look for. nCino met analysts' revenue expectations last quarter, reporting revenues of $141.4 million, up 14.3% year on year. It was a slower quarter for the company, with full-year guidance of slowing revenue growth and full-year EPS guidance missing analysts' expectations significantly. Is nCino a buy or sell going into earnings? Read our full analysis here, it's free. This quarter, analysts are expecting nCino's revenue to grow 9.5% year on year to $140.3 million, slowing from the 12.7% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.16 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. nCino has missed Wall Street's revenue estimates three times over the last two years. Looking at nCino's peers in the vertical software segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Q2 Holdings delivered year-on-year revenue growth of 14.6%, beating analysts' expectations by 1.7%, and Upstart reported revenues up 67%, topping estimates by 5.2%. Q2 Holdings traded up 13.3% following the results while Upstart was down 9.7%. Read our full analysis of Q2 Holdings's results here and Upstart's results here. There has been positive sentiment among investors in the vertical software segment, with share prices up 7.3% on average over the last month. nCino is up 14.6% during the same time and is heading into earnings with an average analyst price target of $27.57 (compared to the current share price of $26.26). Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Sign in to access your portfolio
Associated Press
19-05-2025
- Business
- Associated Press
Q2 Announces New Solution to Help Financial Institutions Connect Digital Banking With ERP Systems for Commercial Clients
AUSTIN, Texas--(BUSINESS WIRE)--May 19, 2025-- Q2 Holdings, Inc. (NYSE:QTWO), a leading provider of digital transformation solutions for financial services, today announced Direct ERP, a new solution designed to help banks and credit unions enable banking operations directly within commercial customers' enterprise resource planning (ERP) systems. Direct ERP aims to ease the reconciliation process for businesses' accounting departments, leading to greater transparency, increased cash flow, reduced processing time and less manual involvement. Manual financial processes create inefficiencies between banking and accounting systems, posing challenges to businesses and resulting in poor user experience and a drain on staff and financial resources. Direct ERP removes this friction by integrating banking directly into the ERP system, which automates workflows, enhances security and reduces errors and operational effort for integrations and payment processing. Direct ERP allows commercial clients to initiate payments, retrieve account data and manage reporting and approvals directly from their ERP or accounting system. 'Commercial customers demand efficient and reliable integration between their banking and accounting systems,' said Q2 Chief Technology Officer Adam Blue. 'Direct ERP enables banking operations within the ERP software experience, automating critical payment and reporting workflows. This allows banks and credit unions of all sizes to compete for even the largest corporate customers.' Most financial institutions still struggle to support this level of integration. According to Datos Insights research, 91% of North American mid-size and large businesses say it's important to conduct banking operations directly within their ERP systems, but few banks and credit unions offer the tools to make that possible. 'At Synovus we're committed to prioritizing automation and streamlining complex processes for our commercial clients,' said Katherine Weislogel, head of treasury and payment solutions at Synovus. 'This new solution enhances our integration technology capabilities and transforms how we support them more efficiently.' Direct ERP is part of Q2 Direct Data Services, a product family that also includes Direct Payables and Direct Account Recon. Collectively, Q2 Direct Data Services offers financial institutions the opportunity to build stronger bonds with commercial customers by automating the delivery and receipt of payment files via Secure File Transfer Protocol (SFTP) or Application Programming Interface (API). Integration for Direct ERP into the Q2 Digital Banking Platform is enabled via connection partners such as Koxa and Ninth Wave, who provide access to key ERP systems including NetSuite, Workday, Sage Intacct, Microsoft Dynamics Business Central, QuickBooks, and Xero, among others. Direct Data Services is a key component of Q2 Catalyst, a suite of best-in-class commercial banking solutions designed to help banks and credit unions win more deals, onboard clients faster, serve them better, and grow profitable relationships. To learn more, visit and read Q2's blog ' Accounting System Integration: The Next Must-Have for Commercial Banks " and whitepaper ' Modernizing B2B Payments '. About Q2 Holdings, Inc. Q2 is a leading provider of digital transformation solutions for financial services, serving banks, credit unions, alternative finance companies, and fintechs in the U.S. and internationally. Q2 enables its financial institution and fintech customers to provide comprehensive, data-driven digital engagement solutions for consumers, small businesses and corporate clients. Headquartered in Austin, Texas, Q2 has offices worldwide and is publicly traded on the NYSE under the stock symbol QTWO. To learn more, please visit Follow us on LinkedIn and X to stay up to date. View source version on CONTACT: MEDIA CONTACT Carly Baker Q2 Holdings, Inc. +1 210-391-1706 [email protected] KEYWORD: UNITED STATES NORTH AMERICA TEXAS INDUSTRY KEYWORD: PROFESSIONAL SERVICES APPS/APPLICATIONS TECHNOLOGY SOFTWARE FINANCE FINTECH BANKING SOURCE: Q2 Holdings, Inc. Copyright Business Wire 2025. PUB: 05/19/2025 10:00 AM/DISC: 05/19/2025 10:01 AM
Yahoo
08-05-2025
- Business
- Yahoo
Q2 Holdings's (NYSE:QTWO) Q1: Beats On Revenue, Stock Soars
Banking software provider Q2 (NYSE:QTWO) reported Q1 CY2025 results exceeding the market's revenue expectations , with sales up 14.6% year on year to $189.7 million. Guidance for next quarter's revenue was better than expected at $193 million at the midpoint, 0.8% above analysts' estimates. Its GAAP profit of $0.07 per share was significantly above analysts' consensus estimates. Is now the time to buy Q2 Holdings? Find out in our full research report. Q2 Holdings (QTWO) Q1 CY2025 Highlights: Revenue: $189.7 million vs analyst estimates of $186.6 million (14.6% year-on-year growth, 1.7% beat) EPS (GAAP): $0.07 vs analyst estimates of -$0.01 (significant beat) Adjusted Operating Income: $32.7 million vs analyst estimates of $29.96 million (17.2% margin, 9.1% beat) The company slightly lifted its revenue guidance for the full year to $779.5 million at the midpoint from $775.5 million EBITDA guidance for the full year is $172.5 million at the midpoint, above analyst estimates of $168.1 million Operating Margin: 1.2%, up from -8.6% in the same quarter last year Free Cash Flow Margin: 19.9%, similar to the previous quarter Market Capitalization: $4.94 billion Company Overview Founded in 2004 by Hank Seale, Q2 (NYSE:QTWO) offers software-as-a-service that enables small banks to provide online banking and consumer lending services to their clients. Sales Growth Examining a company's long-term performance can provide clues about its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last three years, Q2 Holdings grew its sales at a 11.7% annual rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the software sector, which enjoys a number of secular tailwinds. Q2 Holdings Quarterly Revenue This quarter, Q2 Holdings reported year-on-year revenue growth of 14.6%, and its $189.7 million of revenue exceeded Wall Street's estimates by 1.7%. Company management is currently guiding for a 11.6% year-on-year increase in sales next quarter. Looking further ahead, sell-side analysts expect revenue to grow 10.4% over the next 12 months, similar to its three-year rate. Despite the slowdown, this projection is above the sector average and implies the market is forecasting some success for its newer products and services. Unless you've been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) stock benefiting from the rise of AI. Click here to access our free report one of our favorites growth stories.
Yahoo
29-04-2025
- Business
- Yahoo
Q2 Holdings (QTWO) Fell due to Profit Taking and a Weak Equity Market
Conestoga Capital Advisors, an asset management company, released its first-quarter 2025 investor letter. A copy of the letter can be downloaded here. Equity markets started the year with a rally due to optimism about a strong economy and expectations of moderating inflation and lower interest rates. However, concerns over slowing earnings from major Technology companies, geopolitical tensions, and an upcoming announcement on tariffs led to a sharp decline in equities by the end of the first quarter. Investors sought safety, driving U.S. Treasury yields down. The Conestoga Small Cap Composite returned -11.35% (net) in the first quarter compared to the Russell 2000 Growth Index's -11.12% return. The Conestoga SMid Cap Composite returned -5.73% compared to the Russell 2500 Growth Index's -10.80% return. The Conestoga Micro-Cap Composite returned -8.24% vs the Russell Microcap Growth Index's return of -17.75%. Finally, the Conestoga Mid Cap Composite returned 0.96% (net), compared to the Russell Midcap Growth Index's -7.12% return. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2025. In its first-quarter 2025 investor letter, Conestoga Capital Advisors highlighted stocks such as Q2 Holdings, Inc. (NYSE:QTWO). Q2 Holdings, Inc. (NYSE:QTWO) is a digital solutions provider to financial institutions, financial technology companies, FinTechs, and alternative finance companies. The one-month return of Q2 Holdings, Inc. (NYSE:QTWO) was -1.62%, and its shares gained 49.95% of their value over the last 52 weeks. On April 28, 2025, Q2 Holdings, Inc. (NYSE:QTWO) stock closed at $78.71 per share with a market capitalization of $4.904 billion. Conestoga Capital Advisors stated the following regarding Q2 Holdings, Inc. (NYSE:QTWO) in its Q1 2025 investor letter: "Based in Austin, TX, Q2 Holdings, Inc.'s (NYSE:QTWO) 4Q24 results were modestly ahead of expectations and 2025 guidance was ahead of Street expectations. The company's revenues were up 13% and subscription growth was 16% for the quarter. The company's 4Q24 bookings were the second best in its history. The company has shown strong improvement in EBITDA and free cash flow. With the difficult equity market backdrop and the stock's significant appreciation in 2024 (the stock was up over 100%), the stock was subject to profit taking." A finance professional at their computer logging into the company's branded digital banking platform. Q2 Holdings, Inc. (NYSE:QTWO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 29 hedge fund portfolios held Q2 Holdings, Inc. (NYSE:QTWO) at the end of the fourth quarter, compared to 21 in the third quarter. While we acknowledge the potential of Q2 Holdings, Inc. (NYSE:QTWO) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In another article, we covered Q2 Holdings, Inc. (NYSE:QTWO) and shared the list of worst performing fintech stocks to buy according to analysts. Q2 Holdings, Inc.'s (NYSE:QTWO) strong performance in the previous quarter positively impacted Conestoga Capital Advisors' results. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
