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Under-the-Radar Coronavirus Stock Everbridge Jumps 14% After Earnings Beat

By Beth McKenna - Feb 22, 2021 at 9:06AM

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The pandemic and recent extreme weather-related events have brought increased attention to the critical event management (CEM) platform provider.

Everbridge (EVBG -0.10%), the leader in critical event management (CEM) software, reported fourth-quarter and full-year 2020 results after the market close on Thursday, Feb. 18.

Shares soared 14.5% on Friday, which we can attribute to the software-as-a-service (SaaS) company beating the Wall Street consensus estimates for both Q4 revenue and earnings. That jump brings the stock's one-year gain to 54.4%. 

"Coronavirus breaking news" in capital letters over top of a digital world map.

Image source: Getty Images.

Everbridge's key quarterly numbers

Metric

Q4 2020

Q4 2019 

Change

Revenue 

$75.6 million $57.1 million 32%

GAAP operating income

($18.3 million) ($10.2 million) Loss widened 79%

Adjusted operating income

$1.3 million $2.6 million (50%)

GAAP net income

($24.6 million) ($13.1 million) Loss widened 88%

Adjusted net income

$1.0 million $3.2 million (69%)

GAAP earnings per share (EPS)

($0.70) ($0.39) Loss widened 79%

Adjusted EPS

$0.03 $0.09 (67%)

Data source: Everbridge. GAAP = generally accepted accounting principles.

Wall Street was looking for adjusted EPS of $0.02 on revenue of $72.5 million, so Everbridge surpassed both expectations. It also exceeded the high end of its revenue guidance range by $2.9 million.

While earnings declined, cash flows soared. Cash flow from operations skyrocketed 1,193% year over year to a record $19.4 million. And free cash flow was $15.9 million (also a record), compared to a cash outflow of $1.3 million in the year-ago period.

The company ended the quarter (and year) with $467.2 million in cash, cash equivalents, and short-term investments. 

For full-year 2020, Everbridge's revenue grew 35% year over year to $271.1 million. In the year, its customers used its platform to send more than 5 billion interactions, up more than 40% from 2019. In 2020, its adjusted net loss narrowed to $0.2 million, or $0.01 per share, from a net loss of $1.8 million, of $0.05 per share, in 2019. 

What happened with Everbridge in the quarter?

  • It ended the quarter (and year) with 5,613 global enterprise customers, up 12% from the year-ago period.
  • It closed 66 deals of more than $100,000, a new record, CEO David Meredith said on the earnings call. He added that the growing number of larger deals "increased substantially" its product average selling price to "well over $100,000," another new record.
  • A record 18 customers selected or upgraded to the company's CEM platform, bringing its total number of CEM customers to 128, up 68% from a year ago.
  • The company announced COVID-19 Shield: Vaccine Distribution, an extension to its CEM platform. Among others, the state of West Virginia and the county of Sarasota, Florida, are using the company's CEM platform to power their digital vaccination distribution systems. 
  • It announced that it was selected by Oregon to power its statewide public alerts and warning system.

What management had to say

Here's part of what Meredith had to say in the earnings release:

We innovated to quickly develop new CEM solutions, such as our COVID-19 Shield: Vaccine Distribution, to help our customers identify, manage, and respond to new threats against their people, assets and processes. Our fourth-quarter results included high-water marks for the number of CEM and Public Warning wins. [...] Finally, we signed and expanded new third-party reseller agreements that substantially extend our overall channel reach.

On the earnings call, chairman of the board Jaime Ellertson summed up a key takeaway, since eventually the company's COVID-19-related business will fade:

2020 has demonstrated how the Everbridge team can adapt CEM to solve any critical event, even a black swan event like COVID, that literally afflicts every organization and person on the planet. [Emphasis added.]

First-quarter and full-year 2021 guidance

Period Metric Guidance

Projected Change YOY

Q1 2021 Revenue $75.3 million to $75.7 million 28% to 29%
Q1 2021 Adjusted earnings per share (EPS) ($0.12) to ($0.10) N/A. Loss expected to widen from $0.16 per share in year-ago period.
Full-year 2021 Revenue $342.1 million to $344.1 million 26% to 27%
Full-year 2021 Adjusted EPS ($0.25) to ($0.19) N/A. Loss expected to widen from $0.01 per share in year-ago period.

Data source: Everbridge. YOY = year over year. 

Management expects sales growth to be robust in the first quarter and throughout 2021. Adjusted losses are projected to widen because the company is investing in long-term growth initiatives.

Going into the release, Wall Street had been modeling for a Q1 2021 adjusted loss of $0.06 per share on revenue of $74.8 million, so Everbridge's bottom-line outlook came in lower than expected, but its revenue guidance exceeded the consensus estimate.

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