DG FastChannel Earnings: Here’s Why Investors are Selling Shares Now

DG FastChannel, Inc. (NASDAQ:DGIT) had a loss and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 23.61%.

These stocks are hitting our Profit Targets. Click here now to discover winning stocks!

DG FastChannel, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased to $-0.75 in the quarter versus EPS of $0.16 in the year-earlier quarter.

Revenue: Decreased 4.34% to $103.6 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: DG FastChannel, Inc. reported adjusted EPS loss of $-0.75 per share. By that measure, the company missed the mean analyst estimate of $0.21. It missed the average revenue estimate of $107.03 million.

Quoting Management:“We believe that the steps we have taken over the past year position DG to meet the increasing demand from advertisers to manage video-centric campaigns across TV, online and mobile screens,” said Neil Nguyen, CEO and President of Digital Generation, Inc. “We saw positive results in both our online video and data driven products. We will continue to leverage DG’s innovation and strength in developing new products to address the evolving advertising industry.”
In discussing the company’s vision, Mr. Nguyen added, “Online video continues to be at the core of DG’s growth strategy, with online video advertising expected to reach over $8 Billion by 2016. While advertising may appear to fragment across screens and new technology on the surface, we believe it will in fact integrate through the consistent use of data and technology we are developing. This will enable advertisers to reach their customers through highly targeted campaigns across screens and across available inventory. I believe there is no company better positioned to drive this level of convergence than DG.”

Key Stats (on next page)…

Revenue increased 10.42% from $93.82 million in the previous quarter. EPS increased to $-0.75 in the quarter versus EPS of $-7.96 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $0.05 and has not changed. For the current year, the average estimate is a loss of $7.73, which is the same with that ninety days ago.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)