Bill.com Holdings (NYSE:BILL) stock fell about 22% on Thursday’s extended trade despite better-than-expected results for the second quarter of Fiscal 2023. The decline in share price is primarily due to the weaker-than-expected Fiscal 2023 outlook provided by the company.
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Bill.com provides cloud-based software solutions for financial operations to small-to-medium-sized businesses.
Q4 Performance
Revenues came in at $260 million, up 66% year-over-year, and also surpassed the analysts’ estimates of $243.6 million. Higher revenues can be attributed to a 25% rise in subscription revenues and a 59% growth in transaction fees.
Meanwhile, the company posted adjusted earnings of $0.42 per share, which came above the Street’s estimate of $0.13 per share.
In the fiscal second quarter, Bill.com processed $67.3 billion in total payment volume, up 15% year-over-year. Moreover, 20.8 million transactions were processed during the quarter, reflecting a growth of 34%.
Outlook
The company provided a weak revenue outlook for fiscal Q3. Revenues are expected to be in the range of $245 million to $248 million. In contrast, analysts were expecting $251.5 billion in revenue. Bill.com expects third-quarter earnings to be between $0.22 and $0.25.
Furthermore, for the full Fiscal Year 2023, the company anticipates revenue between $999 million to $1.01 billion. The consensus estimate is pegged at $1 billion.
The company also approved a $300 million share repurchase program.
Should I Buy BILL Stock?
Overall, Wall Street is optimistic about BILL stock. The Strong Buy consensus rating for Bill.com is based on 12 Buys and one Hold. The average stock price target of $157.15 suggests upside potential of 21.91% from current levels. Shares have gained about 11% in the past three months.
