Zacks: Analysts Expect Mimecast Ltd (MIME) Will Announce Quarterly Sales of $80.89 Million

Wall Street analysts forecast that Mimecast Ltd (NASDAQ:MIME) will post $80.89 million in sales for the current fiscal quarter, Zacks reports. Six analysts have issued estimates for Mimecast’s earnings, with estimates ranging from $80.72 million to $81.04 million. Mimecast reported sales of $63.07 million during the same quarter last year, which would suggest a positive year over year growth rate of 28.3%. The firm is expected to issue its next earnings report after the market closes on Thursday, November 8th.

On average, analysts expect that Mimecast will report full year sales of $333.02 million for the current year, with estimates ranging from $332.00 million to $334.55 million. For the next fiscal year, analysts forecast that the business will report sales of $405.86 million, with estimates ranging from $393.10 million to $416.00 million. Zacks’ sales calculations are a mean average based on a survey of analysts that cover Mimecast.

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Mimecast (NASDAQ:MIME) last issued its earnings results on Thursday, August 9th. The technology company reported $0.04 earnings per share (EPS) for the quarter, hitting the Thomson Reuters’ consensus estimate of $0.04. The business had revenue of $78.40 million during the quarter, compared to analyst estimates of $76.71 million. Mimecast had a negative return on equity of 11.41% and a negative net margin of 5.55%. Mimecast’s revenue for the quarter was up 34.7% on a year-over-year basis. During the same quarter in the prior year, the firm earned $0.01 earnings per share.

MIME has been the subject of several research reports. BidaskClub raised Mimecast from a “hold” rating to a “buy” rating in a research note on Wednesday, September 12th. Zacks Investment Research raised Mimecast from a “hold” rating to a “buy” rating and set a $48.00 target price for the company in a research note on Wednesday, July 11th. Goldman Sachs Group raised Mimecast from a “neutral” rating to a “buy” rating in a research note on Wednesday, June 20th. Deutsche Bank upped their target price on Mimecast to $50.00 and gave the stock a “buy” rating in a research note on Friday, August 10th. Finally, Monness Crespi & Hardt raised Mimecast from a “neutral” rating to a “buy” rating and set a $48.00 target price for the company in a research note on Thursday, September 13th. Three analysts have rated the stock with a hold rating and thirteen have assigned a buy rating to the company’s stock. The stock has an average rating of “Buy” and an average price target of $45.08.

In other Mimecast news, Director Hagi Schwartz sold 2,170 shares of the business’s stock in a transaction that occurred on Tuesday, August 7th. The stock was sold at an average price of $39.83, for a total value of $86,431.10. Following the completion of the sale, the director now owns 2,082 shares in the company, valued at $82,926.06. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CEO Peter Bauer sold 22,500 shares of the business’s stock in a transaction that occurred on Monday, July 23rd. The shares were sold at an average price of $41.46, for a total value of $932,850.00. The disclosure for this sale can be found here. Insiders sold 305,726 shares of company stock valued at $12,339,835 in the last quarter. Corporate insiders own 29.00% of the company’s stock.

A number of hedge funds have recently made changes to their positions in the business. United Services Automobile Association lifted its position in Mimecast by 39.8% in the second quarter. United Services Automobile Association now owns 53,740 shares of the technology company’s stock valued at $2,215,000 after purchasing an additional 15,300 shares during the last quarter. Advisors Asset Management Inc. bought a new stake in Mimecast in the second quarter valued at approximately $238,000. Verition Fund Management LLC bought a new stake in Mimecast in the second quarter valued at approximately $240,000. California Public Employees Retirement System lifted its position in Mimecast by 32.1% in the second quarter. California Public Employees Retirement System now owns 35,058 shares of the technology company’s stock valued at $1,445,000 after purchasing an additional 8,529 shares during the last quarter. Finally, Putnam Investments LLC bought a new stake in Mimecast in the second quarter valued at approximately $1,496,000. Hedge funds and other institutional investors own 68.04% of the company’s stock.

MIME traded up $3.15 during midday trading on Monday, hitting $35.15. The stock had a trading volume of 854,378 shares, compared to its average volume of 353,521. The firm has a market cap of $2.50 billion, a P/E ratio of -185.00 and a beta of 0.21. The company has a debt-to-equity ratio of 0.52, a current ratio of 1.41 and a quick ratio of 1.41. Mimecast has a 1 year low of $26.50 and a 1 year high of $46.87.

About Mimecast

Mimecast Limited, a email and data security company, provides cloud security and risk management services for corporate information and email. The company offers Mimecast Email Security services, including targeted threat protection services, such as URL Protect that addresses the threat from emails containing malicious links; Attachment Protect that reduces threat from weaponized or malware-laden attachments used in spear-phishing and other attacks; Impersonation Protect that gives protection from malware-less social engineering attacks; and Internal Email Protect, which allows customers to monitor, detect, and remediate security threats that originate from within their internal email systems.

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Is Lowe’s Companies Inc. a Buy?

The bullish case for buying Lowe's (NYSE:LOW) has been a tough one for investors to get behind in the past. The retailer consistently trails rival Home Depot (NYSE:HD) on key operating metrics, including sales growth, profitability, and financial efficiency. Yet Lowe's stock has outperformed its bigger peer in recent months on rising optimism that this performance gap might shrink or disappear altogether.

Below we'll look at the reasons for that shifting mood, and whether they make Lowe's a more attractive candidate for investors today.

Image source: Getty Images.

The latest trends

Lowe's recent results did nothing to change the broader story of a business that operates firmly in the shadow of its larger, better performing competitor. Sure, sales sped up to a 5% increase last quarter from 1% in the prior quarter. But Home Depot managed a more robust boost (8%), as warmer weather spurred higher demand for seasonal items like gardening supplies. As in each of the last several fiscal years, Home Depot has captured more than its fair share of the industry's growth so far in 2018.

Lowe's also saw its operating profit margin dive to 10% of sales from 12% last quarter. And while some of the decline came from one-time writedown charges, the retailer is still far behind Home Depot on this score. 

HD operating margin data by YCharts. TTM = trailing 12 months.

In fact, Home Depot executives are expecting to reach a margin of roughly 15% of sales this year while Lowe's has predicted weaker profitability results -- closer to 10% -- as it fights to boost customer traffic and protect market share. 

Trying a new strategy

Lowe's holds the edge over its chief rival in the potential for improved results, an area that's especially difficult for investors to quantify. In Marvin Ellison, the company has a new CEO who has accumulated deep industry experience as a top executive at Home Depot. That combination of fresh leadership with highly relevant expertise has many investors optimistic that Lowe's can finally make headway at clawing back some of the market share it has lost in recent years.

That happy scenario hasn't emerged yet. In fact, in one of his first acts as Lowe's leader, Ellison had to lower the company's short-term outlook for fiscal 2018. However, investors were pleased to learn that Ellison plans to bring big changes to the company, starting with an aggressive trimming of underperforming stores and the rollout of a new inventory management process.

It will be a huge challenge to create the type of highly efficient multichannel retailer that the new management team envisions. Ellison is optimistic, though. He told investors in late August, "I've been down this road before, and I have a clear understanding of the steps and processes required to build a world-class omnichannel environment."

For the stock's rally so far this year to find support and extend into 2019, Ellison and his team must back up their bluster with numbers that show better customer traffic trends, accelerated comparable-store sales growth, and improved operating margin. Income investors might even reasonably expect more-robust dividend hikes over the next few years given that Lowe's currently allocates 35% of profits to its payout, compared with Home Depot's 55%. 

Ellison will be free to boost the dividend payout as Lowe's operating trends improve. But for now, investors buying the stock have to be comfortable betting that the retailer's market share struggles will end soon. Until there's a concrete indication that they will, investors might want to watch Lowe's stock from the sidelines.