ASUR - Asure Software's (NASDAQ: ASUR) Impressive Q1 2023 Financial Results Raise Guidance and Analyst Estimates For 2023
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In the dynamiclandscape of cloud-based Human Capital Management (HCM) solutions, onecompany stands out with its impressive financial performance andstrategic growth initiatives. Asure Software, Inc. (NASDAQ: ASUR) haskicked off 2023 with a bang, delivering a stellar first quarter thatnot only surpassed expectations but also set the stage for an excitingyear ahead.
Let's delve into the details of Asure's Q1 2023 financialresults , its strategic partnerships, and the bullish response fromWall Street analysts.
ASURFinancial Highlights
Asure reported revenue of $33.1 million for Q12023, marking a 36% increase from the same period in the previousyear. The company's recurring revenue also saw a substantial rise,reaching $28.0 million, up 22% from Q1 2022.
The company's netincome stood at $0.3 million, a significant improvement from theprevious year's first quarter, showing a $3.4 million increase.EBITDA was reported at $6.8 million, up $4.3 million from Q1 2022, andadjusted EBITDA was $8.2 million, up $4.8 million from the same periodin the previous year.
Gross profit for the first quarter was $24.4 million, a 58%increase from Q1 2022. Non-GAAP gross profit was $25.7 million, with amargin of 78%, compared to $16.7 million and a margin of 68% in Q12022.
Business Developments andPartnerships
Asure has been actively expanding its business operations andpartnerships. The company has partnered with Harbor Compliance tosimplify federal, state, and local tax registrations and businesslicensing. This initiative, powered by AsureMarketplace, aims toreduce administrative burdens for customers by providing a seamlesssolution for tax payroll registration and compliance with multi-stateentity registration requirements.
In addition, Asure has announced an integrationwith ZayZoon to provide on-demand wages to employees of Asure’spayroll customers. This collaboration allows employees of smallbusinesses to access their earned wages instantly, promoting financialwellness and providing their employers with a distinct competitiveadvantage for recruitment and retention.
Raised Financial Targets and Guidance
Asure has also raisedits financial targets and guidance for 2023, reflecting thecompany's confidence in its growth trajectory. The company'sfirst-quarter results, characterized by a 36% year-over-year revenue growth and strong gains in operating margins, are the result oftargeted sales initiatives and the positive reception of increasedofferings in AsureMarketplace.
ASUR Chairman and CEO, Pat Goepel, stated that thecompany is investing in the business to enhance the differentiation ofits solutions by introducing new products and improving userexperiences. The company plans to continue working with current andprospective clients to remain intentional with the integrations thatthey release.
ASUR: AnalystsBullish Response To The Strong Quarter
Wall Street analystshave been very active with their updates afterAsure’s Q1 2023 financial results. The company now holds a total ofseven "strong buy" ratings and an average twelve-month pricetarget of $19.83, which implies an additional upside of over 53% fromits current price.
Here is a breakdown of each analyst's rating and pricetarget for ASUR:
- Vince Collicio of Barrington reiterated his “buy”rating with a $17.00 price target
- Joshua Reilly of Needhamreiterated a “buy” rating with a $20.00 target
- EricMartinuzzi of Lake Street assigned shares with a “buy” rating anda $19.00 target
- Bryan Bergin of TD Cowen reiterated a“buy” with a $19.00 price target
- Richard Baldry of RothMKM maintains a “buy” rating with the most bullish price target of$25.00
- An analyst from Northland Securities initiated thestock with a “buy” and a $19.00 target
- Jeff Van Rhee ofCraig-Hallum continues to maintain a "buy" rating and has a$18.00 price target
Conclusion
The first quarter of 2023 has been a period ofsignificant growth and expansion for Asure Software, Inc. Thecompany's financial results demonstrate a strong performance withsubstantial increases in revenue, net income, and gross profit.Asure's strategic partnerships and integrations, such as thosewith Harbor Compliance and ZayZoon, are expected to further enhanceits service offerings and customer experience.
The company'sraised financial targets and guidance for 2023 reflect its confidencein its growth trajectory and the effectiveness of its targeted salesinitiatives. Asure's commitment to investing in its business andenhancing its solutions is a promising sign for its future.
The bullish responsefrom Wall Street analysts further underscores the positive outlook forASUR. With seven "strong buy" ratings and an averagetwelve-month price target indicating a potential upside of over 53%,the consensus is that Asure is well-positioned for continuedsuccess.
Inconclusion, Asure Software's impressive Q1 2023 financial results,strategic business developments, and positive analyst coverage paint apicture of a company on a strong upward trajectory. As Asure continuesto innovate and expand its offerings, it is poised to further solidifyits position as a leading provider of cloud-based Human CapitalManagement software solutions.
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