Manhattan Associates Earnings Preview

Manhattan Associates (Nasdaq: MANH  ) didn't hit the Street's expectations last quarter, but investors hope that it will rebound this quarter. The company will unveil its latest earnings on Tuesday. Manhattan Associates is a developer and provider of supply chain software solutions that help organizations optimize business advantages gained through those solutions.

What analysts say:

• Buy, sell, or hold? Analysts generally think investors should hang on to Manhattan Associates, with half rating the stock a hold. Analysts don't like Manhattan Associates as much as competitor American Software overall.
• Revenue forecasts: On average, analysts predict $83.2 million in revenue this quarter. That would represent a rise of 7.1% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of 39 cents per share.

What our community says:
CAPS All Stars are solidly backing the stock with 83.3% assigning it an "outperform" rating. The majority of the Fools are in agreement with the All Stars; 70.3% give it an "outperform" rating. Fools are gung-ho about Manhattan Associates, though the message boards have been quiet lately with only 15 posts in the past 30 days. Manhattan Associates has a CAPS rating of zero out of five stars.

Management:
Manhattan Associates' income has fallen year over year by an average of more than fivefold. A year-over-year revenue decrease last quarter snaps a streak of three consecutive quarters of revenue increases. The company's gross margin shrank by 3.8 percentage points in the last quarter. Revenue fell 3% while cost of sales rose 5.9% to $32.5 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q1	Q4	Q3	Q2
Gross Margin	54.7%	55%	55.1%	57.9%
Operating Margin	10.5%	12.3%	13%	15.5%
Net Margin	10%	9%	8.4%	10.5%

One final thing: If you want to keep tabs on Manhattan Associates movements, and for more analysis on the company, make sure you add it to your Watchlist.

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