As we reflect back on the just completed Q3 finance and HR software sector earnings season, we dig into the relative performance of Flywire (NASDAQ:FLYW) and its peers.
Organizations are constantly looking to improve organizational efficiencies, whether it is financial planning, tax management or payroll. Finance and HR software benefit from the SaaS-ification of businesses, large and small, who much prefer the flexibility of cloud-based, web-browser delivered software paid for on a subscription basis than the hassle and expense of purchasing and managing on-premise enterprise software.
The 14 finance and HR software stocks we track reported a mixed Q3; on average, revenues beat analyst consensus estimates by 3.22%, while on average next quarter revenue guidance was 1.54% above consensus. Increasing interest rates hurt growth companies as investors search for near-term cash flows, but finance and HR software stocks held their ground better than others, with the share prices up 8.96% since the previous earnings results, on average.
Best Q3: Flywire (NASDAQ:FLYW)
Originally created to process international tuition payments for universities, Flywire (NASDAQ:FLYW) is a cross border payments processor and software platform focusing on complex, high-value transactions like education, healthcare and B2B payments.
Flywire reported revenues of $95.2 million, up 40.4% year on year, beating analyst expectations by 8.39%. It was a stunning quarter for the company, with a significant improvement in gross margin and very optimistic guidance for the next quarter.
“I’m pleased to report another strong quarter for Flywire, where we delivered strong year-over-year adjusted gross profit and EBITDA, with revenue at an all-time high,” said Mike Massaro, CEO of Flywire.
Flywire pulled off the highest full year guidance raise of the whole group. The stock is up 34.2% since the results and currently trades at $24.28.
Is now the time to buy Flywire? Access our full analysis of the earnings results here, it's free.
Founded by CEO Jason Gardner in 2009, Marqeta (NASDAQ: MQ) is an innovative card issuer that provides companies with the ability to issue and process virtual, physical, and tokenized credit and debit cards.
Marqeta reported revenues of $191.6 million, up 45.7% year on year, beating analyst expectations by 5.92%. It was a very strong quarter for the company, with exceptional revenue growth and a solid beat of analyst estimates.
The stock is up 5.45% since the results and currently trades at $6.57.
Is now the time to buy Marqeta? Access our full analysis of the earnings results here, it's free.
Slowest Q3: Workday (NASDAQ:WDAY)
Founded by industry veterans Aneel Bushri and Dave Duffield after their former company PeopleSoft was acquired by Oracle in a hostile takeover, Workday (NASDAQ:WDAY) provides cloud-based software for organizations to manage and plan finance and human resources.
Workday reported revenues of $1.59 billion, up 16.2% year on year, beating analyst expectations by 0.85%. It was a decent quarter for the company, with topline results beating analyst expectations.
Workday had the weakest performance against analyst estimates in the group. The stock is up 17.4% since the results and currently trades at $168.44.
Read our full analysis of Workday's results here.
One of the oldest payroll service providers, Paychex provides payroll and human resource (HR) solutions.
Paychex reported revenues of $1.19 billion, up 7.37% year on year, beating analyst expectations by 1.21%. It was a weaker quarter for the company, with slow revenue growth and a decline in gross margin.
Paychex had the slowest revenue growth among the peers. The stock is up 1.54% since the results and currently trades at $116.07.
Read our full, actionable report on Paychex here, it's free.
Asure Software (NASDAQ:ASUR)
Created from the merger of two small workforce management companies in 2007, Asure (NASDAQ:ASUR) provides cloud based payroll and HR software for small and medium-sized businesses (SMBs).
Asure Software reported revenues of $21.9 million, up 21.8% year on year, beating analyst expectations by 3.25%. It was a solid quarter for the company, with a significant improvement in gross margin.
The stock is up 52.6% since the results and currently trades at $10.
Read our full, actionable report on Asure Software here, it's free.
The author has no position in any of the stocks mentioned