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Category: Stock Market and Black Knight
Date: 17 February 2020 Stock Price: $74.39 We take a look at the 4th quarter earnings release of their 2019 fiscal year of Black Knight Inc, a company that provides integrated technology, services, data and analytics to the mortgage and real estate industries
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About Black Knight Inc.
Black Knight, Inc. (NYSE: BKI) is a trusted, long-standing business partner to many of the nation’s leading lenders and servicers. Through innovative software, data and analytics solutions, Black Knight helps our clients facilitate and automate many of the business processes across the mortgage lifecycle, from originations, servicing and default. Black Knight’s superior software, world-class data, insightful analytics and unparalleled industry knowledge offers clients the ability to better manage risk, improve financial performance and drive greater efficiency.
Overview of Black Knight's 4th quarter 2019 earnings report
The data below refers to the latest quarter unless specified otherwise
- Revenue:$300.1 million (up from $285.4 million from the same quarter of the previous year)
- Revenues increased by 5.15% over the last 12 months
- Total expenses: $228 million (up from $222 million for the same quarter of the previous year)
- Cost of sales increased by 2.7% over the last 12 months
- Net income: $12.9 million (down from $42.8 million for the same quarter of the previous year)
- Diluted earnings per share: $0.09 (down from $0.29 for the same quarter of the previous year)
- PE ratio of Black Knight: 101.9
- Diluted weighted-average shares outstanding: 149 million (up from 148.2 million for the same quarter of the previous year)
- Cash and cash equivalents: $15.4 million
- Cash and cash equivalents per share: $0.103
- Cash and cash equivalents makes up 0.14% of Black Knight's market capital
- Cash and cash equivalents makes up 0.39% of Black Knight's total assets
- Receivables: $175.1 million
- Receivables makes up 4.42% of Black Knight's total assets
- Shareholders equity in Black Knight: $1.898 billion
- Shareholders equity per Black Knight share: $12.73
- Black Knight is trading at 5.84 times its shareholders equity which is outside the expected range of between 2 and 4 times that most firms tend to trade at
- Cash generated from operations for the full fiscal year: $378.3 million
- Cash generated from operations per share for the full fiscal year: $2.53
Black Knight management commentary on their 4th quarter 2019 earnings
JACKSONVILLE, Fla. - February 13, 2020 - Black Knight, Inc. (NYSE: BKI), a leading provider of software, data and analytics solutions to the mortgage and consumer loan, real estate and capital markets verticals, today announced unaudited financial results for the fourth quarter and year ended December 31, 2019.
Black Knight Chairman Bill Foley said, "2019 was another solid year for Black Knight as we continued to execute against our long-term strategic initiatives to drive growth through selling to existing clients, winning new clients in existing markets and launching new products. Our performance highlights the fundamental strength of our core business and we look forward to continuing to deliver value to clients and shareholders in 2020."
Black Knight Chairman Bill Foley said, "2019 was another solid year for Black Knight as we continued to execute against our long-term strategic initiatives to drive growth through selling to existing clients, winning new clients in existing markets and launching new products. Our performance highlights the fundamental strength of our core business and we look forward to continuing to deliver value to clients and shareholders in 2020."
Black Knight Chief Executive Officer Anthony Jabbour added, "We are pleased with our fourth quarter financial performance, which was in line with our expectations. Adjusted Revenues increased by 5% and Adjusted EBITDA increased by 6%, which drove margin expansion of 50 basis points to 49.5%. For the year, Adjusted Revenues increased by 5.5% and Adjusted EBITDA increased by 7.5%, which drove margin expansion of 90 basis points to 49.5%. We are excited about Black Knight’s strong business momentum across the enterprise and leadership in the industry. We remain focused on delivering innovative solutions to our industry in 2020 and beyond."
Business Outlook
The following forward-looking statements reflect Black Knight’s expectations as of today's date. Given the number of risk factors, uncertainties and assumptions discussed below, actual results may differ materially. Black Knight does not intend to update its forward-looking statements until its next quarterly results announcement, other than in publicly available statements. Black Knight's full year 2020 outlook is as follows: • Revenues and Adjusted Revenues are expected to be in the range of $1,190 million to $1,214 million. • Adjusted EPS is expected to be in the range of $1.97 to $2.06. • Adjusted EBITDA is expected to be in the range of $589 million to $607 million.
Business Outlook
The following forward-looking statements reflect Black Knight’s expectations as of today's date. Given the number of risk factors, uncertainties and assumptions discussed below, actual results may differ materially. Black Knight does not intend to update its forward-looking statements until its next quarterly results announcement, other than in publicly available statements. Black Knight's full year 2020 outlook is as follows: • Revenues and Adjusted Revenues are expected to be in the range of $1,190 million to $1,214 million. • Adjusted EPS is expected to be in the range of $1.97 to $2.06. • Adjusted EBITDA is expected to be in the range of $589 million to $607 million.
Black Knight (NYSE: BKI) stock price history
The image below shows the stock price history of Black Knight (NYSE:BKI) over the last 5 years. And its been a very good time for Black Knight stockholders. 5 years ago the stock was trading at around $28.40 a stock and its currently trading at $74.39. That's a significant return of 161.9% provided to Black Knight stockholders over the last 5 years.
The stock of Black Knight is currently trading at a lot closer to its 52 week low of $51.03 than it is to its 52 week high of $74.76 which to us is a clear indication that the short term sentiment and momentum of Black Knight stock is very positive at this point in time.
The stock of Black Knight is currently trading at a lot closer to its 52 week low of $51.03 than it is to its 52 week high of $74.76 which to us is a clear indication that the short term sentiment and momentum of Black Knight stock is very positive at this point in time.
Recent coverage of Black Knight (NYSE: BKI)
The extract below shows recent coverage of Borgwarner as obtained from TheStreet.com
Read the full article here
Read the full article here
Black Knight (NYSE: BKI) latest stock valuation
So based on the 4th quarter 2019 earnings report of Black Knight (NYSE:BKI) and their fiscal guidance provided for the 2020 fiscal year what do we value Black Knight stock at? Based on the earnings report an their fiscal guidance our valuation model provides a target price (full value price) for Black Knight at $42.10 a stock.
We therefore feel that the stock of Black Knight is overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price which in this case is $42.10 A good entry point into the stock of Black Knight would therefore be at $37.90 or below. We expect the stock of Black Knight pull back strongly from its current price in coming weeks and months to levels closer to our target price (full value price).
We therefore feel that the stock of Black Knight is overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price which in this case is $42.10 A good entry point into the stock of Black Knight would therefore be at $37.90 or below. We expect the stock of Black Knight pull back strongly from its current price in coming weeks and months to levels closer to our target price (full value price).
Next earnings release of Black Knight
It is expected that Black Knight will release their 1st quarter 2020 earnings report in middle May 2020