Q1 Earnings in Review: JCOM, SSNC, GOOG

In this post I'd like to touch on the earnings results of J2 Global Communications (JCOM), SS&C Technologies (SSNC), and Google (GOOG).

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On Monday (4/18/2005) J2 Global Communications (JCOM) announced its Q1 earnings results. Revenue rose 40% YoY to $32.2M and net income ~60% YoY to $10.2M, beating guidance and analyst estimates. Its gross margin improved slightly YoY to 79.8% from 79%.

Management also reiterated FY 2005 guidance as follows:

Revenues $145 -- $148 million
Net Earnings Per Share (1) $1.70 -- $1.75

...giving JCOM a forward P/E of ~19.5.

The stock still looks like a great value to me and remains one of my largest personal holdings. I strongly encourage due diligence here. For more information on JCOM reference my previous posts about the company here and here.

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On Wednesday (4/20/2005) SS&C Technologies (SSNC) announced record numbers for Q1. Revenues increased 43% YoY to $27.4M and net income increased 58% YoY to $6M. The company's outsourcing revenues saw the largest gains, expanding more than 100% YoY to $10.457M.

In a nutshell, SS&C provides business services to the financial services industry. For more information on what they do reference SS&C's Reuters Business Summary.

I like the company because of its focus on recurring cash flows and the broad scope of its product offerings, a distinct competitive advantage. Its rapidly-growing outsourcing business is an added bonus - the outsourcing trend will only gain in strength as time goes by.

Fundamentally speaking, SS&C has a solid balance sheet with more than $100M in cash and investments and a current ratio of ~3.5. Plus, despite the stock rallying nearly 20% over Thursday and Friday, the company's EV/FCF ratio still stands at a relatively modest ~16 (~$31M TTM FCF).

I like SSNC at current levels, but, as always, conduct your own due diligence.

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On Thursday (4/21/2005) Google (GOOG) announced suberb results for Q1. The company reported $1.29 of net income per diluted share, completely blowing away analyst estimates.

I don't own any shares of Google, but this faster-than-expected growth and all of the recent talk about the company (like the Gates vs. Google article from the latest issue of Fortune) are starting to make me wonder about buying a small stake in Google. I plan on writing an article specifically about Google in the near future.

Full disclosure: I am long JCOM and I am long SSNC. I do not own shares of GOOG.

The opinions expressed in this blog are my personal opinions. I am in no way responsible for trades made or not made because of something read here. One should always do his or her own due diligence before buying a stock.