Ultimate Software Group Shares Jumped: What You Need to Know
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Ultimate Software Group (NAS: ULTI) have jumped by 16% after the software maker reported third-quarter earnings last night.
So what: Revenue for the quarter jumped 19% to $67.8 million, which resulted in non-GAAP net income of $4.9 million, or $0.18 per share. Recurring revenue from the company's important Software-as-a-Service (SaaS) offering grew by 24% and comprised 81% of the quarter's sales.
Now what: Ultimate's annualized retention rate with existing recurring revenue customers is north of 96%, and the company expects recurring revenue to rise by 25% in 2011 and 2012. A couple of analysts who have buy ratings on the stock are out today with bullish comments. Needham & Company and Canaccord Genuity, who both have $60 price targets, like the company's bookings growth.
Interested in more info on Ultimate Software Group? Add it to your watchlist byclicking here.
At the time this article was published Fool contributorEvan Niuholds no position in any company mentioned.Click hereto see his holdings and a short bio. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.