j2 Global, Inc. (NASDAQ:JCOM) posted impressive second-quarter 2016 results with earnings and revenues beating estimates. The Los Angeles, CA-based company’s second-quarter earnings (on an adjusted basis) of $1.16 per share (including stock-based compensation expenses) beat the Zacks Consensus Estimate by 8 cents. Also, earnings increased over 45% on a year-over-year basis.
Quarterly revenues came in at $211.8 million, up 20.3% year over year. The top line also surpassed the Zacks Consensus Estimate of $206 million. Segment-wise, total Cloud Service revenues expanded 14.1% to $141.4 million in the reported quarter. Digital Media revenues came in at $69.3 million, up 36.4%. IP Licensing revenues, however, contracted 15.4% to $1.1 million in the quarter under review.
j2 Global posted quarterly gross margin of 83.2% compared with 83.2% in the year-ago quarter. Operating expenses in the quarter under review stood at $117.3 million, up 21.5% from the year-ago quarter. Quarterly EBITDA (on an adjusted basis) was $97.5 million, up 22.6% year over year.
j2 Global exited the second quarter of 2016 with approximately $313.7 million in cash & cash equivalents compared with $255.5 million at the end of 2015. Long-term debt at the end of the reported quarter was $596.8 million compared with $592 million at the end of 2015. Free cash flow, at the end of the first half of the year, declined 44% year over year to approximately $124 million.
Dividend
In a shareholder friendly move, the company’s board of directors declared a 3% increase in its quarterly dividend, raising the figure to 34.5 cents per share. This marks the twentieth successive quarterly dividend increase. The payment will be made on Sep 1, 2016, to shareholders of record as of Aug 17.
2016 View
The Internet and cloud services company maintained its revenue projection at the band of $830 million to $860 million for 2016. The earnings (on an adjusted basis) projection has been reiterated at the range of $4.70 to $5.00. The Zacks Consensus Estimate for 2016 earnings is pegged at $4.60 per share on revenues of $846.2 million.
Zacks Rank & Key Picks
j2 Global presently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the broader Computer & Technology space include Instructure Inc. (NYSE:INST) , Medical Transcription Billing, Corp. (NASDAQ:MTBC) and MeetMe Inc. (NASDAQ:MEET) . All the stocks carry a Zacks Rank #2 (Buy).
J2 GLOBAL INC (JCOM): Free Stock Analysis Report
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