ACI Worldwide Earnings Preview

ACI Worldwide (Nasdaq: ACIW  ) will try to beat its earnings estimates for the fourth consecutive quarter. The company will unveil its latest earnings on Tuesday, Feb. 14. ACI Worldwide and its subsidiaries develop, market, install, and support a line of software products and services mainly focused on facilitating electronic payments.

What analysts say:

• Buy, sell, or hold?: Analysts strongly back ACI Worldwide, with six out of seven rating it a buy and the remainder rating it a hold. Analysts like ACI Worldwide better than competitor Fair Isaac overall. Analysts haven't adjusted their rating of ACI Worldwide for the past three months.
• Revenue forecasts: On average, analysts predict $129.5 million in revenue this quarter. That would represent a decline of 8.3% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.69 per share. Estimates range from $0.57 to $0.78.

What our community says:
CAPS All-Stars are strongly supporting the stock, with 80.8% awarding it an outperform rating. Most of the community agrees with the All-Stars, with 82% assigning it a rating of outperform. Fools feel positively about ACI Worldwide, though the message boards have been quiet lately, with only 31 posts in the past 30 days. Despite the majority sentiment in favor of ACI Worldwide, the stock has a middling CAPS rating of three out of five stars.

Management:
The company increased its gross margin by 2.9 percentage points in the last quarter. Revenue rose 15.6% while cost of sales rose 5.4% to $33.8 million from a year earlier.

Now let's get some insight into how efficient management is at running the business. Margins illustrate how efficiently a company captures portions of sales dollars. ACI Worldwide's net margins, which reflect what percentage of revenue becomes profit, have been rising year over year for the last four quarters. Here is how ACI Worldwide has been doing for the last four quarters:

Quarter	Q3	Q2	Q1	Q4
Gross Margin	69.9%	68.3%	68.4%	75.7%
Operating Margin	10%	9.2%	7.2%	30.3%
Net Margin	9.4%	8.6%	1.6%	19.2%

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Earnings estimates provided by Zacks.