Digital River Second Quarter Earnings Sneak Peek

Digital River, Inc. (NASDAQ:DRIV) will unveil its latest earnings on Tuesday, July 31, 2012. Digital River provides end-to-end global e-commerce and marketing solutions to a variety of companies in software, consumer electronics, computer games, video games, and other markets.

Digital River, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 4 cents per share, a decline of 20% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 9 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at 4 cents during the last month. For the year, analysts are projecting profit of 69 cents per share, a decline of 12.7% from last year.

Past Earnings Performance: Last quarter, the company saw net income of 19 cents per share versus a mean estimate of profit of 19 cents per share. This comes after two consecutive quarters of exceeding expectations.

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A Look Back: In the first quarter, profit fell 32.5% to $4.7 million (14 cents a share) from $7 million (18 cents a share) the year earlier, meeting analyst expectations. Revenue rose 4.3% to $102.4 million from $98.2 million.

Stock Price Performance: Between May 29, 2012 and July 25, 2012, the stock price had risen $2.02 (13.7%), from $14.79 to $16.81. The stock price saw one of its best stretches over the last year between June 25, 2012 and July 5, 2012, when shares rose for eight straight days, increasing 16.1% (+$2.38) over that span. It saw one of its worst periods between May 9, 2012 and May 18, 2012 when shares fell for eight straight days, dropping 7% (-$1.10) over that span.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.95 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 13.1% in the second quarter of the last fiscal year, 12.3% in the third quarter of the last fiscal year and 14.7% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Analyst Ratings: There are mostly holds on the stock with six of 11 analysts surveyed giving that rating.

Wall St. Revenue Expectations: Analysts are projecting a rise of 0.9% in revenue from the year-earlier quarter to $93.4 million.

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

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