Wednesday, June 7, 2023 stock forecast: Earnings send BILL through chart resistance, next stop at... stock forecast: Earnings send BILL through chart resistance, next stop at $185

  • rose 17% Friday.
  • BILL’s fiscal fourth-quarter earnings beat analysts’ expectations.
  • The stock’s advance has put it above resistance at $168. (BILL ) shares rose 16.7% to $174.36 in early trade Friday after dazzling the market with Thursday night’s earnings performance. The software-as-a-service company, which is almost unanimously liked by Wall Street analysts, reported adjusted earnings per share (EPS) of -$0.03 on revenue of $200.2 million, excelling on both top and bottom lines. Earnings per share beat consensus estimates by 11 cents, and revenue beat the average estimate by $17 million.

Market most impressed with revenue growth of 156% year over year. Transaction fees increased 201% year over year and organic core revenue increased 71% year over year.

“In 2022, 400,000 businesses will use our solutions to automate their financial operations, get paid faster, Better manage their cash flow and more than triple the number of businesses that used us in the last fiscal year,” said CEO and founder Rene Lacerte. “We managed over $225 billion in payments and our network grew to 4.7 million members who initiated or received electronic payments through our platform.”

Management guided for a midpoint revenue of $209.5 million for the next quarter and said it would deliver non-GAAP EPS of $0.05 to $0.07. The fact that turned profitable so quickly also helped push the stock higher. Analysts’ average target price is $186.42.

Bill. com stock forecast stock is trading at nearly 20 times sales at its current pace in fiscal 2023 (19.6X). However, that doesn’t seem to matter to its outspoken supporters, who are mostly hedge funds and other institutional investors. Like Snowflake (SNOW), is sitting on the high end of the market in the 2022 sell-off, not as bad as other high multiple tech stocks. It still benefits from skepticism.

Friday’s rally has pushed Beer above resistance at $168. This price level acted as a support level in February and March. The rally also brings it back to where it was before the May earnings report sent shares tumbling.

The $185 level should now be the focus of all profit-seeking bulls. This resistance area originated in the second half of April and also aligns with the stock’s consensus price target. Above is the $210 level in early and mid-April. The accumulation/distribution indicator has been trending up since late May, possibly giving some traders a hint that BILL is poised for a rebound.

BILL daily chart

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