This tech company’s earnings are on the rise, with 25 analysts forecasting increases for this year, and 15 for 2017.
Citrix Systems (CTXS)
From Dow Theory Forecasts
Citrix Systems’ (CTSX) operating momentum has outpaced the stock’s 12% advance in the past year. For the 12 months ended June, per-share profits surged 71% for Citrix, a designer of desktop-virtualization products that let workers remotely connect to data devices. Both operating cash flow and free cash flow have risen by double-digits in four consecutive quarters. Citrix shares trade at 16 times trailing earnings, their lowest level in more than a decade.
Analyst profit estimates have drifted higher since management raised its 2016 guidance in July. For the September quarter, the consensus expected Citrix to report earnings per share of $1.19, up 14% on 2% revenue growth. But the company reported that its September-quarter earnings per share surged 27% to $1.32 excluding special items, exceeding the consensus by $0.13. Sales, up 3% to $841 million, also topped the consensus.
Citrix raised its full-year guidance, implying December quarter earnings per share of $1.48 to $1.50 on revenue of $890 million to $900 million, roughly in line with analyst expectations at the time of the announcement.
Management said 2017 sales should climb 3% to 4%, excluding its GoTo business, which is being hived off; the consensus currently calls for 3.5% growth.
Citrix is a Focus List Buy and a Long-Term Buy.
Richard J. Moroney, CFA, Dow Theory Forecasts, www.dowtheory.com, 800-233-5922, October 17 and 24, 2016