DealerTrack Holdings Earnings: Quarter Lacks Gusto

DealerTrack Holdings, Inc. (NASDAQ:TRAK) reported its results for the first quarter. DealerTrack Holdings is a provider of on-demand software and data solutions for the automotive retail industry in the United States.

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DealerTrack Holdings Earnings Cheat Sheet for the First Quarter

Results: Net income for DealerTrack Holdings, Inc. fell to $17 million (39 cents per share) vs. $24.7 million (59 cents per share) a year earlier. This is a decline of 31.4% from the year-earlier quarter.

Revenue: Rose 18.7% to $91.6 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: DealerTrack Holdings, Inc. reported adjusted net income of 22 cents per share. By that measure, the company beat the mean estimate of 16 cents per share. It beat the average revenue estimate of $84.2 million.

Quoting Management: Mark F. O’Neil, chairman and chief executive officer of DealerTrack, commented, “We are pleased with our strong performance in the first quarter. Transaction revenue grew at a multiple of growth in car sales as we increased the average transaction revenue per car sold. Our subscription business also performed well, as we saw particularly strong interest in our Inventory solution.” O’Neil further commented, “We are increasing our revenue guidance for 2012, reflecting strong first quarter results and an increase in our 2012 car sales expectations. Continued momentum combined with investments in our future growth make us more confident in our outlook for 2012 and beyond.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 39.5%, with the biggest boost coming in the third quarter of the last fiscal year when revenue rose 51.7% from the year earlier quarter.

The company has now surpassed analyst estimates for four quarters in a row. It beat the mark by 8 cents in the fourth quarter of the last fiscal year, by 10 cents in the third quarter of the last fiscal year, and by 2 cents in the second quarter of the last fiscal year.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the second quarter is 22 cents per share, down from 25 cents ninety days ago. For the fiscal year, the average estimate has moved down from 91 cents a share to 83 cents over the last ninety days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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