Blackbaud (BLKB +4.08%) stock is sinking Tuesday. The software specialist's share price was down 12.6% as of 3 p.m. ET, according to data from S&P Global Market Intelligence.
Blackbaud published its fourth-quarter results after the market closed yesterday. While the company's non-GAAP (adjusted) earnings per share of $1.14 beat the average analyst estimate's call for per-share earnings of $1.05, revenue for the period missed Wall Street's target. The company posted sales of roughly $295 million, while the average analyst estimate had called for sales of $298.7 million.
NASDAQ: BLKB
Key Data Points
Blackbaud's Q4 report had some bright spots
Blackbaud's sales grew roughly 7.4% year over year in Q4, and adjusted organic recurring revenue was up 8.4% in the period. Meanwhile, the company's adjusted earnings per share were up roughly 67.6% compared to the prior-year period. Adjusted free cash flow (FCF) for the quarter came in at $36.3 million, up $28.7 million compared to Q4 last year.
On an adjusted basis, Blackbaud posted substantial improvements on the margins front in last year's final quarter. The company also recently reached a settlement with the Federal Trade Commission (FTC) regarding its handling of a 2020 ransomware attack, potentially alleviating some investor concerns. But there are signs that margins will take a step back again this year, and investors are selling out of the stock today.
What comes next for Blackbaud?
This year, Blackbaud is guiding for adjusted revenue between $1.17 billion and $1.2 billion. At the midpoint of the target, that would suggest roughly 12.9% growth compared to the approximately $1.05 billion in adjusted sales it recorded last year.
Meanwhile, the company is guiding for adjusted earnings to come in between $4.12 per share and $4.38 per share. At the midpoint of the guidance range, that would suggest annual growth of roughly 5.5%. Adjusted free cash flow is projected to be between $254 million and $274 million -- good for growth of roughly 23.7% at the midpoint.
With projections for significant slowdowns for earnings and FCF growth, it's not surprising that the stock is losing ground today.
