WisdomTree Investments, Inc. (NasdaqGS:WETF) is scheduled to report Q3 earnings results on October 30, 2020.
The company is expected to report earnings of $0.05/share on revenue of $63.28 million. The consensus earnings per share (EPS) of $0.05/share is based on a poll of 8 analysts and represents a decline in eps of −12.3% over the same quarter last year, when the company reported earnings of $0.06/share.
The revenue forecast of $63.28 million based on a poll of 8 analysts implies a year-over-year (YoY) decline in revenue of −6.6%. Last year the company reported $67.718 million in revenue for the quarter.
| Metric | Expected | Prior Year | YoY Change |
|---|---|---|---|
| Revenue | $63.28 | $67.72 | −6.6% |
| EPS | $0.05 | $0.06 | −12.3% |
Earnings Call Trends
Historically, management has exceeded analyst expectations 3 out of the last 8 tracked quarters, missed 1 quarter, and met expectations 3 quarters.
What are your expectations from WisdomTree Investments, Inc. for earnings this quarter? Let us know in the comments!
| Quarter | Expected | Reported | Surprise | Result |
|---|---|---|---|---|
| Q2, 2020 | $0.04 | $0.05 | 27.1% | Beat |
| Q1, 2020 | $0.05 | $0.07 | 40.7% | Beat |
| Q4, 2019 | $0.06 | $0.06 | 0% | Met |
| Q3, 2019 | $0.05 | $0.06 | 14.0% | Beat |
| Q2, 2019 | $0.05 | $0.05 | 0% | Met |
| Q1, 2019 | $0.05 | $0.05 | 0% | Met |
| Q4, 2018 | $0.08 | $0.06 | −22.3% | Missed |
| Q3, 2018 | $0.09 | $0.09 | 0% | Met |
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 June 30, 2020, the stock price reacted by increasing 1.4%.
| Report Date | Price Day Prior | Price Next Day | Change % | Result |
|---|---|---|---|---|
| July 31, 2020 | $3.55 | $3.60 | 1.4% | Increase |
| May 1, 2020 | $3.24 | $3.05 | −5.9% | Decline |
| January 31, 2020 | $4.16 | $4.21 | 1.2% | Increase |
| October 25, 2019 | $4.88 | $5.28 | 8.2% | Increase |
The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −2.94, the model suggests that the company is not likely to be an earnings manipulator. A value of −2.94 implies a 0.2% chance of earnings manipulation.
Fundamentals And Technical Analysis
WisdomTree Investments, Inc. is currently trading at $3.83/share, down −3.2% for the day. The company is trading at approximately 69.5% of its 52-week high of $5.52/share. The company’s stock price is up 6.5% since the last earnings report and down −2.7% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 54.65 suggests the company is trading in technically neutral 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 −11.93 and a forward P/E multiple of 15.64.
WisdomTree Investments, Inc.’s current share price also implies a price-to-book (P/B) multiple of 1.90. The following table summarizes some other key fundamental ratios:
| Metric | Value |
|---|---|
| Last Reported Fiscal Period Key | FY2020.Q2 |
| Period End Date | June 30, 2020 |
| Stock Price (Current) | $3.83 |
| P/E Ratio | −11.9x |
| P/E Ratio (Fwd) | 15.6x |
| PEG Ratio | 0.0 |
| Total Debt / Total Capital | 19.0% |
| Levered Free Cash Flow | $50.599 million |
| EV / EBITDA | 13.5x |
WisdomTree Investments, Inc. is a small-cap stock with a market capitalization of $545.3 million and a total enterprise value of $777.5 million. The company operates in the Financials sector and the Capital Markets industry.
WisdomTree Investments, Inc., through its subsidiaries, operates as an exchange-traded funds (ETFs) sponsor and asset manager. It offers ETFs in equities, currency, fixed income, and alternatives asset classes. The company also licenses its indexes to third parties for proprietary products, as well as offers a platform to promote the use of WisdomTree ETFs in 401(k) plans. It develops index using its fundamentally weighted index methodology. In addition, the company provides investment advisory services. The company was founded in 1985 and is based in New York, New York.
