Earnings Previews: Coupa Software, GitLab, Uipath

The three major U.S. equity indexes closed mixed Thursday. The Dow Jones industrials added 0.46%, and the S&P 500 rose by 0.3% while the Nasdaq slipped by 0.26%. Eight of 11 sectors ended the day with small gains, led by health care (1.6%) and utilities (1.4%). Energy closed down 2.5%.

The Bureau of Labor Statistics releases its nonfarm payrolls report for August Friday morning. New jobs increased by 3150,000, well below the 526,000 jobs added in July. Headline unemployment rose from 3.5% to 3.7%. Investors are stoked. All three major indexes traded higher shortly after Friday’s opening bell.

After markets closed Thursday, Lululemon reported results that beat estimates on both the top and bottom lines. Revenue rose by nearly 29% year over year, and the company issued upside guidance for the current quarter and the full fiscal year. Shares traded up more than 11% early Friday.

Broadcom also reported top-line and bottom-line beats, with revenue rising nearly 25% year over year. The chipmaker also raised its current-quarter guidance. The stock was up about 3% in early trading.

U.S. markets are closed Monday for the Labor Day holiday. Here is a preview of three software companies set to report results after U.S. markets close on Tuesday.

Coupa Software

Shares of cloud-based business spending management provider Coupa Software Inc. (NASDAQ: COUP) have dropped by 77.7% over the past 12 months. The stock fell to its 52-week low about a week after reporting quarterly results in June, even though the company beat estimates and guided second-quarter results above estimates. It could be that integrating all the company’s previous acquisitions is weighing on the stock.

Of 30 brokerages covering the company, 14 have a Buy or Strong Buy rating and 13 have Hold ratings. At a recent price of around $56.50 a share, the upside potential based on a median price target of $80.00 is 41.6%. At the high price target of $108.00, the upside potential is 91.2%.

Second-quarter revenue is forecast at $203.99 million, which would be up 3.9% sequentially and by 13.8% year over year. Adjusted earnings per share (EPS) are forecast at $0.09, up 8.1% sequentially but down about 65.4% year over year. For the full 2023 fiscal year ending in January, Coupa is expected to post EPS of $0.25, down 70.2%, on sales of $840.24 million, up 15.9%.

The stock trades at 228.6 times expected 2023 EPS, 100.9 times estimated 2024 earnings of $0.56 and 52.5 times estimated 2025 earnings of $1.08 per share. The stock’s 52-week range is $50.54 to $270.79. Coupa does not pay a dividend. Total shareholder return for the past year is negative 77.7%.

GitLab

GitLab Inc. (NASDAQ: GTLB) provides a collaborative software development platform in the United States, Europe and Asia. The company came public in mid-October of last year and jumped to its post-IPO high less than a month later. Since the initial public offering, the shares have dropped by about 51.4%.

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