Avid ’17 forecast dampens enthusiasm of a solid Q4

 

imgres 17-14-22.png

The results are in for Avid Technology, and they’re not too late and not too painful.

The outlook for this year leaves a bit to be desired, however.

On Thursday morning, Burlington-based Avid, which makes digital-editing technology used in newsrooms and feature films, reported net income of $5.2 million (13 cents per share) for the fourth quarter of 2016, reversing a loss in the same period a year earlier. Excluding one-time items, profits were 30 cents per share, quite a bit better than the 15 cents per share that analysts were forecasting.

The company posted revenue of $115.3 million in the period, up from a forecast of $113.5 million.

For all of 2016, Avid reported profit of $48.2 million ($1.20 per share) on revenue of $511.9 million. So yeah, for now anyway, Avid shares are selling for just 4 times earnings. But analysts expect earnings of just 13 cents per share in 2017, which would now puts the P/E ratio at something like 36. Not so pretty anymore, right?

There’s also a bit of a disconnect when one looks at revenue expectations for this year. Avid officials announced Thursday they expect revenues to come in at between $405 million and $435 million, which is short of the analyst forecast calling for $447.9 million (and, granted, it’s just three analysts).

Avid shares responded positively on Thursday, moving up 28 cents to close at $4.88. However, they gave back 18 cents Friday to close at $4.70, and appear to have dropped a few more pennies in after-hours activity.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s