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What's in the Offing for Jack Henry (JKHY) in Q3 Earnings?

Jack Henry & Associates, Inc. JKHY is scheduled to report third-quarter fiscal 2023 results on May 2.

For the fiscal third quarter, the Zacks Consensus Estimate for sales is pegged at $509.2 million, indicating growth of 4.8% from the prior-year quarter’s reported figure.

The consensus mark for earnings per share is pinned at $1.09, which suggests a decline of 6% from the year-ago quarter’s reported figure.

The company’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters while missing the same once, the average surprise being 6.08%.

Jack Henry & Associates, Inc. Price and EPS Surprise

Jack Henry & Associates, Inc. Price and EPS Surprise
Jack Henry & Associates, Inc. Price and EPS Surprise

Jack Henry & Associates, Inc. price-eps-surprise | Jack Henry & Associates, Inc. Quote

Factors at Play

Jack Henry’s results for the fiscal third quarter are likely to reflect portfolio strength.

In the underlined quarter, the company expanded its credit card offerings in partnership with TIB to strengthen its payment solutions portfolio. Jack Henry is leveraging TIB’s Agent Credit Card program for this purpose.

The move is expected to have aided Jack Henry in gaining momentum among various financial institutions in the quarter under review.

This apart, Jack Henry’s outsourcing and cloud services are expected to have acted as key catalysts in the quarter under review. The growing momentum of the Banno Digital suite, Symitar platform, new card processing solution and treasury management is likely to have driven the company’s performance in the quarter under review.

Robust debit and credit processing solutions of the company are likely to have bolstered its debit and credit clientele in the fiscal third quarter.

Apart from this, the company’s robust core solutions are expected to have driven the top line in the quarter to be reported on a growing adoption rate.

The increasing adoption of Jack Henry Banking solutions is expected to have contributed well to the company’s core segment’s performance in the fiscal third quarter.

A solid momentum across the Payments and Complementary segments is expected to get reflected in the to-be-reported quarterly results.

Growth across technology solutions and expanding customer relationships are expected to have contributed significantly to the company’s performance in the quarter under review.

In the fiscal third quarter, Jack Henry got picked by L&N Federal Credit Union, which will leverage JKHY’s Symitar platform to help commercial and small business members manage the lifecycle of their loans.

Further, Jack Henry extended its partnership with Farmers and Merchants Bank. The bank intends to expand its business and agricultural accounts to larger markets by leveraging Jack Henry's Banno Business and treasury management services.

However, the impacts of rising headcounts and personnel costs are likely to get reflected in the fiscal third-quarter results.

Additionally, increasing expenses related to the card processing platform are expected to have affected the company’s performance in the quarter.

What Our Model Says

Our proven model doesn’t conclusively predict an earnings beat for Jack Henry this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Jack Henry has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks that you may consider as our model shows that these have the right combination of elements to beat on earnings this season.

DigitalOcean DOCN has an Earnings ESP of +2.30% and a Zacks Rank #2 at present.

DOCN is scheduled to release first-quarter 2023 results on May 9. The Zacks Consensus Estimate for DOCN’s earnings is pegged at 29 cents per share, suggesting a jump from 7 cents per share reported in the prior-year quarter.

BILL Holdings, Inc. BILL has an Earnings ESP of +1.89% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

BILL Holdings is set to report third-quarter fiscal 2023 results on May 4. The Zacks Consensus Estimate for BILL’s earnings is pegged at 24 cents per share. The company incurred a loss of 8 cents per share in the year-ago quarter.

Ceridian HCM CDAY has an Earnings ESP of +9.09% and a Zacks Rank #3 at present.

CDAY is scheduled to report first-quarter 2023 results on May 3. The Zacks Consensus Estimate for CDAY’s earnings is pegged at 33 cents per share, suggesting an increase of 153.8% from the prior-year quarter’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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DigitalOcean Holdings, Inc. (DOCN) : Free Stock Analysis Report

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