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Why BroadSoft Inc Shares Soared

By Brian Pacampara – Feb 29, 2016 at 12:25PM

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The telecom software technologist posts stellar quarterly results and guidance.

Source Image: Broadsoft

What: Shares of the telecom software technologist BroadSoft (NASDAQ: BSFT) were up 17.5% at 10:55 a.m. EST Monday after its quarterly results and outlook topped Wall Street expectations.

So what: Broadsoft shares have perked up in recent weeks on optimism heading into the quarter, and Monday's Q4 results -- adjusted EPS of $1.04 smashed the consensus by $0.37 on revenue growth of $36.2% -- coupled with upbeat guidance only reinforce that positive sentiment. In fact, billings for Q4 increased 9.5% year over year while operating margin increased to 23% from 17% in the year-ago period, giving analysts plenty of good vibes over the company's competitive position going forward.

Now what: Management now sees full-year adjusted EPS of $1.90-$2.10 on revenue of $332 million-$340 million, versus the consensus of $1.93 and $325.1 million, respectively. "In addition to delivering robust financial results, we delivered on our strategic goals," said President and CEO Michael Tessler. "We introduced our vision of the 'future of work' and next-generation business communications with Project Tempo. We expanded BroadCloud internationally, including into Japan, and achieved important milestones on several of the large network transformation deals we previously won. I look forward to continuing this momentum in 2016." Of course, with the shares now up about 40% from their 52-week highs, I'd wait for some of the excitement to fade before buying into that bullishness.

Brian Pacampara has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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