What happened
Shares of Five9 (FIVN 2.02%) gained 17% in October, according to data from S&P Global Market Intelligence. The cloud-based customer contact company got a boost from an earnings and guidance beat at the end of the month.
Five9 published its third-quarter results after the market closed on Oct. 29, posting better-than-anticipated sales and earnings. The company posted adjusted earnings of $0.27 per share on revenue of $112.14 million, topping the average analyst estimate's call for earnings of $0.18 per share on sales of $101.1 million.
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So what
Five9's third-quarter sales climbed roughly 34% year over year, and the company's adjusted gross margin came in at 65.4%, up from 64% in the prior-year quarter. Adjusted earnings per share in the quarter were up 35% compared with Q3 in 2019.
The company also paired the earnings release with an announcement that it would be acquiring Inference Solutions, a provider of virtual agent software. The terms of the deal have yet to be disclosed. Â
Now what
Five9 stock has continued to gain ground amid momentum for the broader market in November's trading. The company's share price is up roughly 14% in the month so far.
Five9 is guiding for sales to come in between $114.5 million and $115.5 million in the fourth quarter, good for 24.6% growth year over year at the midpoint of the target. Adjusted fourth-quarter earnings are projected to be between $0.22 and $0.24 per share, ahead of the consensus target for per-share earnings of $0.22 at the time of the company's Q3 release.
The company has a market capitalization of roughly $10.9 billion and is valued at 25.8 times this year's expected sales.
