Sumo Logic (SUMO) To Report Earnings Tomorrow: Here Is What To Expect

Radek Strnad 2022/03/07 7:08 am EST

Cloud infrastructure analytics maker Sumo Logic (SUMO) will be announcing earnings results tomorrow after market close. Here's what to look for.

Last quarter Sumo Logic reported revenues of $62 million, up 19.5% year on year, beating analyst revenue expectations by 1.9%. It was a mixed quarter for the company, with a decent beat of analyst estimates, but gross margin down from the same period last year.

Is Sumo Logic buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Sumo Logic's revenue to grow 18.7% year on year to $64.3 million, slowing down from the 22.2% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.17 per share.

Sumo Logic Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 3.16%.

Looking at Sumo Logic's peers in the cloud monitoring segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. Dynatrace delivered top-line growth of 31.6% year on year, beating analyst estimates by 2.67% and Datadog reported revenues up 83.7% year on year, exceeding estimates by 11.9%. Dynatrace traded down 9.4% on the results, Datadog was up 17.1%. Read our full analysis of Dynatrace's results here and Datadog's results here.

The fears around raising interest rates have been putting pressure on tech stocks and while some of the software stocks have fared somewhat better, they have not been spared, with share price declining 12% over the last month. Sumo Logic is down 4.98% during the same time, and is heading into the earnings with analyst price target of $18.1, compared to share price of $11.25.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.