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Why Constant Contact Inc Shares Climbed Today

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Constant Contact Inc (NASDAQ: CTCT  ) rose nearly 11% Friday after the company released better-than-expected first-quarter results and forward guidance.

So what: Quarterly revenue rose 15.6%, to $78.9 million, which translated to adjusted net income of $5 million, or $0.16 per diluted share. Analysts, on average, were looking for adjusted earnings of $0.13 per share on sales of $78.59 million.

For the current quarter, Constant Contact expects revenue in the range of $81 million to $81.3 million, with adjusted earnings per share of $0.18 to $0.20. By contrast, analysts were looking for Q2 earnings and revenue of $0.18 per share and $80.96 million, respectively.

Finally, for the full year 2014, Constant Contact sees revenue of roughly $330 million, and adjusted net income of $1.02 per share. Once again, both numbers sit slightly higher than consensus estimates, which call for 2014 earnings of $1.00 per share on sales of $329.6 million.

Now what: This beat was relatively small, but the results and guidance were solid by any measure. If Constant Contact can continue increasing margins despite its modest top-line growth, I think the stock should be able to reward patient investors even after today's pop.

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Steve Symington

Technology and consumer goods specialist for the Fool. Steve looks for responsible businesses which positively shape our lives. Then, he invests accordingly. Enjoy his work? Connect with him on Twitter & Facebook so you don't miss a thing.

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Related Tickers

8/28/2015 4:00 PM
CTCT $25.04 Up +0.64 +2.62%
Constant Contact CAPS Rating: **