PagerDuty’s 4Q Results Top Estimates; Stock Slips 5% As FY22 Loss Widens

Shares of PagerDuty were down about 4.5% in Wednesday’s extended trading session after the software company projected a wider-than-expected loss for 1Q and fiscal 2022.

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Nevertheless, PagerDuty’s (PD) 4Q results fared well versus the Street’s estimates. Moreover, the company forecasted 1Q and FY22 revenues that came in better than analysts’ estimates.

PagerDuty’s 4Q adjusted loss of $0.07 per share worsened from the year-ago period’s adjusted loss of $0.03 per share due to higher operating losses. However, it came in better than the analysts’ expectations of a loss of $0.11 per share. The company’s revenues grew 29.1% year-over-year to $59.3 million and came in above consensus estimates of $57.5 million.

CEO Jennifer Tejada said that “During fiscal 2021 we continued to see strength in the enterprise and mid-market, with total dollar-based net retention of 121 percent and enterprise dollar-based net retention above 125 percent exiting the year.”

As for 1Q, the company expects sales in the range of $61-$63 million, higher than analysts’ expectations of about $60.96 million. Furthermore, for fiscal 2022 (ending Jan. 31, 2022), the company expects to generate revenues in the range of $264-$270 million versus consensus estimates of $262.6 million. (See PagerDuty stock analysis on TipRanks)

However, the company anticipates a 1Q loss in the range of $0.09-$0.10 per share, wider than analysts’ expectations for a loss of $0.07 per share. PagerDuty projects a loss for fiscal 2022 in the range of $0.36-$0.43 per share. Analysts were anticipating a loss of $0.21 per share for fiscal 2022.

Befotre the results, Monness analyst Brian White maintained a Buy rating and a price target of $57 (39.5% upside potential). In a note to investors, the analyst said, “PagerDuty has an exciting opportunity in the real-time digital operations market, playing squarely into the digital transformation trend, but with a more modest valuation compared to other next-gen software vendors.”

Turning now to the rest of the Wall Street community, PagerDuty has a Strong Buy consensus rating based on 6 Buys and 2 Holds. The average analyst price target of $52 implies upside potential of about 27.3% to current levels. Shares have rallied 217.4% in one year.