On Thursday, after market close, Halogen will report its Q4 and fiscal 2013 results. The Ottawa-based company is following on a Q3 in which it lost $718,000 on revenue of $12.3 million, a topline that was up 27% over Q3, 2012.
Abernethy notes that Halogen competitors Cornerstone OnDemand (NASDAQ:CSOD) and The Ultimate Software Group (NASDAQ:ULTI) both recently reported Q4 results that revealed strong double-digit topline gains. Cornerstone’s revenue of $54.9-million was up 51% year-over-year, Ultimate’s was up 24%.
The Cantor analyst notes that Cornerstone management says it is seeing opportunity in the lower mid-market, in part because there is less competition. This is “clearly a positive” for Halogen, he says.
A recent report from Research and Markets said globally, the Talent Management Software market will grow at a Compound Annual Growth Rate of 17.59% between 2013 and 2018.
Abernethy expects Halogen will earn $0.70 a share on revenue of $47.7-million in fiscal 2013, implying a fourth quarter topline of 12.3-million and bottom line of a loss of $0.12.
In a research update to clients this morning, Abernethy maintained his BUY recommendation and $19.00 one-year target on Halogen Software. Shares of the company closed today up 1.1% to $14.08.