Shares of Coupa Software Inc. COUP rallied to a new 52-week high of $41.75, eventually closing a tad bit lower at $41.50 on Feb 15. The company is benefiting from rapid adoption of its software, expanding product portfolio and strong partner base.
The Zacks Consensus Estimate has been improving on a year-over-year basis. The Zacks Consensus Estimate for Coupa is currently pegged at a loss of 39 cents per share for fiscal 2018, much narrower than a loss of $1.36 in fiscal 2017.
Notably, the stock has returned 52.8% in the past year, substantially better than the industry’s rally of 29.7%. The stock has a market cap of $1.85 billion.
Coupa carries a Zacks Rank #3 (Hold).
Factors at Play
Coupa is benefiting from expanding customer base, which reflects growing adoption of spend management platform. This is also driving subscription services revenues as well as gross margin.
Moreover, portfolio strength is expected to drive top-line growth. The company recently launched R20 that leverages Community Intelligence to reduce global supply chain risk and provides the customers new capabilities to optimize spending.
Furthermore, Coupa has been winning accolades in recent times. It was recognized as a leader for capabilities and strategies, in the inaugural IDC MarketScape: Worldwide SaaS and Cloud-Enabled Procurement Applications 2018 Vendor Assessment.
Additionally, around mid-January, the company concluded the offering of $230 million of convertible unsecured senior notes. The offering will lower its cost of capital, consequently strengthening balance sheet. This aids Coupa to capitalize on investment opportunities and pursue strategic acquisitions, further improving growth prospects.
Other Picks
Micron Technology Inc. MU, Lam Research Corporation LRCX and Paycom Software Inc. PAYC are some of the stocks worth considering in the broader technology sector. All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Micron Technology, Lam Research and Paycom Software are currently pegged at 10%, 14.85% and 25.75%, respectively.
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