Solera shares fall on disappointing 2013 guidance
WESTLAKE, Texas (AP) — Shares of Solera Holdings Inc. fell Friday after the software maker reported fiscal fourth quarter results and provided lower-than-expected 2013 guidance.
THE SPARK: The company reported earnings adjusted to exclude one-time items of $44.3 million, or 64 cents per share, up from 62 cents per share in the last fiscal quarter of 2011. Revenue grew to $198.4 million from $182.1 million. Analysts polled by FactSet expected adjusted earnings per share of 61 cents on revenue of $194.9 million.
While the company topped earnings expectations in its latest quarter, its guidance for fiscal 2013 missed Wall Street's mark. The company said it expects adjusted earnings per share between $2.44 and $2.55 on $780 million to $788 million in revenue. Analysts had been forecasting $2.74 a share in adjusted earnings on revenue of $803 million, according to FactSet.
THE BIG PICTURE: Solera's software is used to process automobile insurance claims. Its customers include insurance companies, collision repair shops and automotive recyclers. It has more than 75,000 customers in 60 countries.
THE ANALYSIS: Some analysts said the disappointing fiscal 2013 guidance could be a reflection of the company's history of being conservative with its forecasts.
"We believe management has set expectations low enough to potentially report upside surprises in FY13," Raymond James analyst C. Gregory Peters said in a note to investors.
SHARE ACTION: Solera Holdings Inc. shares fell $1.72, or 4 percent, to $40.97 in afternoon trading. The stock has fallen about 28 percent in the past year.