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Blucora Stock Tanks After Cautious Q3 EPS Guidance Despite Q2 Earnings Beat

Blucora Stock Tanks After Cautious Q3 EPS Guidance Despite Q2 Earnings Beat
  • Blucora Inc (NASDAQ: BCORreported second-quarter FY21 revenue growth of 58% year-on-year to $254.3 million, beating the analyst consensus of $252 million.
  • Wealth Management revenue grew 40% Y/Y to $162.4 million. Tax Software revenue increased 103% Y/Y to $91.9 million.
  • Non-GAAP EPS of $1.28 beat the analyst consensus of $1.14.
  • The adjusted EBITDA margin expanded by 2,309 bps to 30.9%.
  • Blucora generated $97.3 million in operating cash flow during the six months ended Jun. 30, and held $233 million in cash and equivalents.
  • Total client assets ended the quarter up 28% Y/Y to $87.8 billion, with $39.4 billion in advisory assets. Advisory assets increased 49% Y/Y, including $5.3 billion in Avantax Planning Partners (APP) assets.
  • Headquarters Advisory Group proposed acquisition would expand the nationwide footprint of Avantax's in-house RIA.
  • The wealth management and tax software businesses continue to exceed expectations during the year, both completing a solid Q2, CEO Chris Walters stated.
  • Outlook: Blucora sees Q3 revenue of $163.5 million- $168 million compared to the analyst consensus of $164.42 million.
  • It sees Q3 non-GAAP EPS loss of $(0.39) - $(0.33) against the analyst consensus loss of $(0.31).
  • Price action: BCOR shares traded lower by 8.71% at $15.31 on the last check Wednesday.

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