Seaport Global Securities has maintained a Buy rating on Bill.com Holdings Inc. (NYSE: NYSE:BILL) but reduced the price target to $68 from the previous $80.
The adjustment follows the company's fourth fiscal quarter results, which showcased a total revenue of $344 million, surpassing expectations by 4% with a 16% year-over-year increase. Core revenue growth also reflected a 16% rise.
The financial firm's guidance for fiscal year 2025 revealed revenue and adjusted operating income projections that fell short of Seaport Global Securities' estimates. The forecast suggests an 11% increase in revenue at the midpoint and a year-over-year decrease in adjusted operating income.
Notably, Bill.com announced plans for $45 million in incremental investments.
Despite the downward adjustment for fiscal year 2025, the management of Bill.com expressed optimism for the following year, anticipating over 20% growth in core revenue for fiscal year 2026.
Additionally, the company has initiated a new $300 million stock buyback program, which has been positively received by the market.
In other recent news, Bill.com reported robust growth and strategic investments for fiscal year 2024. The company showcased a 22% revenue increase to $1.3 billion and a 68% year-over-year growth in non-GAAP operating income, nearing $200 million. The firm also processed a total payment volume of $300 billion and facilitated over $100 million in payment transactions.
Recent developments include an expansion agreement with Bank of America (NYSE:BAC) and a strategic partnership with Xero to embed Bill.com's onboarding and bill payment capabilities. The company also announced plans to enhance its platform, focusing on virtual card, international payments, and working capital solutions, along with a new $300 million share repurchase program.
Analysts from Needham maintain a Buy rating for Bill.com, highlighting strong demand and growth prospects. For fiscal year 2025, the firm's revenue guidance aligns with market consensus, while the earnings per share forecast was adjusted downwards due to lower rate assumptions.
InvestingPro Insights
InvestingPro data and tips offer some compelling insights into Bill.com Holdings Inc. (NYSE: BILL) that align with the sentiments expressed by Seaport Global Securities. The company's aggressive share buyback program mentioned in the article is underscored by the InvestingPro Tip that management has been actively repurchasing shares, signaling confidence in the company's value. Additionally, Bill.com's strong balance sheet is highlighted by another InvestingPro Tip that the company holds more cash than debt, which is a positive indicator of financial health and may provide resilience in uncertain market conditions.
The data from InvestingPro reveals a robust gross profit margin of 85.28% for the last twelve months as of Q4 2024, reinforcing the company's impressive profitability at the gross level. Moreover, the revenue growth of 21.89% during the same period suggests that Bill.com is expanding its top line effectively. It's worth noting, however, that the company's P/E ratio stands at -171.07, indicating that investors are currently valuing the company for its growth potential rather than current earnings.
For investors seeking a deeper dive into the financials and future prospects of Bill.com, there are additional InvestingPro Tips available, including insights on net income growth and analyst profitability predictions for the year. These tips, which can be found at https://www.investing.com/pro/BILL, may further inform investment decisions and provide a more nuanced understanding of the company's trajectory.
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