Application performance management software company New Relic (NYSE:NEWR) will be reporting earnings tomorrow after market hours. Here's what investors should know.
Last quarter New Relic reported revenues of $239.8 million, up 17.8% year on year, beating analyst revenue expectations by 2.93%. It was a solid quarter for the company, with a significant improvement in gross margin and a decent beat of analyst estimates.
Is New Relic buy or sell heading into the earnings? Read our full analysis here, it's free.
This quarter analysts are expecting New Relic's revenue to grow 17.2% year on year to $241.1 million, slowing down from the 19.2% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.22 per share.
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 2.92%.
Looking at New Relic's peers in the software development segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. F5 Networks delivered top-line growth of 10.9% year on year, beating analyst estimates by 0.62% and Cloudflare reported revenues up 36.8% year on year, missing analyst estimates by 0.22%. F5 Networks traded up 0.52% on the results, Cloudflare was down 23.2%. Read our full analysis of F5 Networks's results here and Cloudflare's results here.
There has been positive sentiment among investors in the software segment, with the stocks up on average 3.39% over the last month. New Relic is up 21.8% during the same time, and is heading into the earnings with analyst price target of $81.3, compared to share price of $84.87.
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The author has no position in any of the stocks mentioned.