Eaton Vance (EV) Earnings Prep: Q4 Report Expected Tuesday

in EARNINGS/INVESTING IDEAS by

Eaton Vance Corp. (NYSE:EV) is scheduled to report Q4 earnings results at approximately 9:00 AM ET on November 26, 2019. Management plans to host a conference call the same morning at 11:00 AM ET.

The company is expected to report earnings of $0.88/share on revenue of $439.4 million. The consensus earnings per share (EPS) of $0.88/share is based on a poll of 8 analysts and represents a growth of 3.9% over the same quarter last year when the company reported earnings of $0.85/share. The revenue forecast of $439.4 million based on a poll of 5 analysts implies a year-over-year (YoY) growth of 0.8%. Last year the company reported $436 million in revenue for the quarter.

Expected to report EPS growth of $0.03/share for Q4, 2019
Metric Expected Prior Year YoY Change
Revenue $439.40 $435.97 0.8%
EPS $0.88 $0.85 3.9%

Eaton Vance primarily derives revenue from management fees. As of July 31, 2019, the company had $483 billion in assets under management.

yOO2oKEtmeSource: Eaton Vance

Earnings Call Trends

Historically, management has exceeded analyst expectations 5 out of the last 8 tracked quarters, missed 1 quarter, and met expectations 2 quarters.

What are your expectations from Eaton Vance for earnings this quarter? Let us know in the comments!

Analyst Expected vs Reported EPS
Quarter Expected Reported Surprise Result
Q3, 2019 $0.87 $0.90 4.0% Beat
Q2, 2019 $0.76 $0.89 17.2% Beat
Q1, 2019 $0.73 $0.73 0.0% Meet
Q4, 2018 $0.82 $0.85 3.7% Beat
Q3, 2018 $0.81 $0.82 1.3% Beat
Q2, 2018 $0.78 $0.77 -0.9% Missed
Q1, 2018 $0.77 $0.78 1.0% Beat
Q4, 2017 $0.70 $0.70 0.0% Meet

One question we always consider here at the Bankers’ Tribune is how important are earnings reports to Eaton Vance’s stock price performance? It’s more important for some companies than for others.

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending July 31, 2019, the stock price reacted by increasing by 5.0%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
2019-08-27 $39.40 $41.36 5.0% Increase
2019-05-21 $37.28 $40.40 8.4% Increase
2019-02-26 $41.47 $42.24 1.9% Increase
2018-11-27 $41.79 $40.75 -2.5% Decline

Fundamentals And Technical Analysis

Eaton Vance is currently trading at $48.68/share, up 1.2% for the day. The company is trading at approximately 100.0% of its 52-week high of $47.29/share. The company’s stock price is up 17.7% since the last earnings report and up 0.9% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 71.31 suggests the company is trading in technically overbought territory. The RSI is considered overbought when above 70 and oversold when below 30.

The current share price implies a price-to-earnings (P/E) multiple of 12.5x and a forward P/E multiple of 13.5x. Eaton Vance’s current share price also implies a price-to-book (P/B) multiple of 4.6x. The following table summarizes some other key fundamental ratios:

Data as of November 25, 2019
Metric Value
Last Fiscal Period FY2019.Q3
Period End Date July 31, 2019
Stock Price (Current) $48.68
P/E Ratio 12.5x
P/E Ratio (Fwd) 13.5x
PEG Ratio 3.5
Total Debt to Capital (%) 10.0%
Levered Free Cash Flow $239.2 million
Enterprise Value / EBITDA 9.8x

Source: Finbox

Company Profile: Eaton Vance Corp.

Eaton Vance Corp. is a mid-cap stock with a market capitalization of $5.225 billion and a total enterprise value of $5.416 billion. The company operates in the Financials sector and Capital Markets industry.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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