Why Conduent Is Friday’s Big Earnings Winner
Conduent stock rallied after the company reported better than expected second-quarter financial results late Thursday.
When Conduent Inc. (NASDAQ: CNDT) reported its second-quarter financial results after the markets closed on Thursday, the business process services company posted $0.12 in earnings per share (EPS) and $1.02 billion in revenue. The consensus estimates had called for a net loss of $0.05 per share and $925.5 million in revenue. The same period of last year reportedly had EPS of $0.13 on revenue of $1.11 billion.
Revenue for the latest quarter beat expectations due to better than expected results in the Government and Transportation segments. Revenue was lower compared with the second quarter of last year, driven by prior-year lost business and COVID-19 related impacts.
Higher than expected activity in the Government business was driven primarily by increased volumes in the Supplemental Nutrition Assistance Program (SNAP) and Pandemic Supplemental Nutrition Assistance Program (P-SNAP) and Unemployment Insurance prepaid cards offerings.
Additional highlights from the second quarter include strong sales performance with $623 million in new business signings, a 90% increase over the same period last year and a 92% increase sequentially. This represents the strongest signings quarter for the company since its spin-off as a standalone public company.
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Conduent also saw annual recurring revenue of signings increase 25% year over year to $105 million, which is up 84% sequentially.
On the books, cash and cash equivalents totaled $428 million at the end of the quarter, down from $496 million at the end of the previous fiscal year.
Conduent stock traded up about 83% Friday morning, at $4.14 in a 52-week range of $1.54 to $7.97. The consensus price target is $2.75.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
